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Resource windfalls, political regimes and political stability

Caselli, Francesco and Tesei, Andrea (2016) Resource windfalls, political regimes and political stability. Review of Economics and Statistics, 98 (3). pp. 573-590. ISSN 0034-6535

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Identification Number: 10.1162/REST_a_00538

Abstract

We study theoretically and empirically whether natural resource windfalls affect political regimes. We show that windfalls have no effect on democracies, while they have heterogeneous political consequences in autocracies. In deeply entrenched autocracies, the effect of windfalls is virtually nil, while in moderately entrenched autocracies, windfalls significantly exacerbate the autocratic nature of the political system. To frame the empirical work, we present a simple model in which political incumbents choose the degree of political contestability and potential challengers decide whether to try to unseat the incumbents. The model uncovers a mechanism for the asymmetric impact of resource windfalls on democracies and autocracies, as well as the the differential impact within autocracies.

Item Type: Article
Official URL: http://www.mitpressjournals.org/loi/rest
Additional Information: © 2016 President and Fellows of Harvard College and the Massachusetts Institute of Technology
Divisions: Economics
Subjects: H Social Sciences > HC Economic History and Conditions
J Political Science > JA Political science (General)
J Political Science > JF Political institutions (General)
JEL classification: O - Economic Development, Technological Change, and Growth > O1 - Economic Development > O10 - General
P - Economic Systems > P1 - Capitalist Systems > P16 - Political Economy
Q - Agricultural and Natural Resource Economics; Environmental and Ecological Economics > Q0 - General > Q00 - General
Sets: Departments > Economics
Date Deposited: 03 Dec 2015 12:31
Last Modified: 20 May 2019 02:00
Funders: Centre for Economic Performance, Banco de España, Centre for Economic Performance, Banco de España
URI: http://eprints.lse.ac.uk/id/eprint/64587

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