Academic journal article Development and Society

Problematising the Resource Curse Thesis*

Academic journal article Development and Society

Problematising the Resource Curse Thesis*

Article excerpt

The natural resource curse thesis is that the blessing/windfall of "nature's gifts" tends to be a curse. The mention of "oil," especially in developing countries, evokes two types of feelings in the form of excitement and fear, further resulting in a discourse about turning a "resource curse" into a "resource blessing." This paper questions this binary representation of the political economy of oil. Using data triangulation, I will show that curses and blessings co-exist, intermingle, and impact diversely on different social groups. Further, there are many forms of impact in between the two which are neither curses nor blessings. This evidence suggests there is room for practical steps to remedy specific weaknesses in existing public policy beyond euphoric reactions and propositions that strike a determinist relationship between resource boom and curse.

Keywords: Oil, Africa, Ghana, Resource Curse, Public Policy

Background

The world of orthodox economists is typically made up of tradeoffs where one person wins and the other loses. Nowhere is this way of seeing development and society more evident than in the analysis of natural resources. Since the seminal paper by Corden and Neary (1982), orthodox economists (e.g., James and Aadland 2011; Beine, Bos, and Coulombe 2012) have persistently used the notion of a resource curse, the binary framework in which resource-rich countries are either entirely blessed or entirely cursed by natural resources.

This paper shows that blessings, curses, and uncertainties co-exist, co-evolve, and co-mingle in practice, and grand narratives about a "blessing" or a "curse" are not only simple but also misleading. What is a blessing to one social class may be a curse to another. Thus, contrary to a narrative of one monolithic scenario of curses or a monolithic scenario of blessings, the situation is more complex. To make this argument, the case of Ghana, a country in West Africa, is used as a case study in this paper.

Relative to other African countries, Ghana has strong institutions. The state has three arms, namely, the central state, the local state, and the traditional state. The central state has strong judiciary and legislative branches, and a democratic executive branch that is regularly changed through generally free and fair electoral means (Gyimah-Boadi 2009). According to the Electoral Commission of Ghana,1 as many as 17 political parties are registered to take part in Ghana's multi-party democracy. In practice, it is the ruling National Democratic Congress and its opposition, New Patriotic Party, that are the largest and most vibrant parties (Bob-Milliar 2011). While Ghana is one of the few countries in Africa where ideology is explicitly stated as part of its political discourse (Elischer 2011) with the ruling government claiming to be social democratic and the largest opposition claiming to be liberal or an exponent of property-owning democracy, in practice, political parties in the country are quite similar in terms of their policies (Obeng-Odoom 2010; Bob-Milliar 2011). Ghana also has a strong and vibrant media which ranks 41st in the world and 6th in Africa, according to Reporters Without Borders (2012).

The local state in Ghana has been around for over two decades and operates in decentralised units totalling 170 spread out all over the country. In Africa, the local government system in Ghana is one of the most mature (Crawford 2010). Ghana has a third state, which is a traditional set up consisting of the chieftaincy institution. It receives considerable respect among the population and is fully recognized in the current Constitution of Ghana. While the traditional state has no direct power over the central and local states and is, in fact, barred from taking part in party politics (see Article 276, clause 1 of the 1992/93 Constitution of Ghana), chieftaincy institution has great power in terms of land management (see Article 267, clauses 1 and 6 of the Constitution of Ghana). …

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