'Resource curse' and how to avoid it

The article addresses the phenomenon of “resource curse” as it affects countries that are dependent upon hydrocarbon and mineral exports. After discussing the concept of “resource curse” and its origins, the paper considers the experience of those nations that the literature asserts avoided a “curse” and secured, instead, a “blessing.” The article determines empirically whether these countries did, indeed, benefit from oil, gas, and mineral projects and on what basis a judgment can be made. It then considers in detail what economic policies were applied and why those policies were pursued. Four case studies are used: Botswana, Chile, Indonesia, and Malaysia. The study concludes that some countries actually did benefit and that the secret to success lies in whether the states are “developmental” or “predatory.”