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The Resource Curse: Democracy And The Developing World

1666 words - 7 pages

When a country strikes oil, or some other valuable natural resource, they may take it as a blessing; however, this discovery is often very destructive. Recent studies in social sciences suggest that developing countries with resource wealth tend to have political crises. This paradox is called the resource curse- the political counterpart of the infamous Dutch disease (Lam et al., 2002)*. In this paper I will argue how this phenomenon not only impedes the development of liberal democracies in non-democratic regimes, but also how it actively destroys liberal values in developing democracies. In specific, I will discuss how political instability, socio-economic disparities and political appeasement produced by resource wealth tend undermine the values of liberal democracy in the developing world.

Special attention must be given to the claim that weak institutions are to blame for this decrease in democracy rather than resource wealth in itself (Lam et al., 2002). I concede that this is partially true, however, weak institutions and the resource curse are by no means mutually exclusive. By definition, undeveloped countries have weak institutions; likewise, countries with weak institutions are generally undeveloped. Since this paper focuses particularly on developing resource rich states, this criticism is not detrimental- but rather complimentary to my argument.

When it comes to undeveloped countries, the discovery of valuable resources can easily lead to resource dependence (Wantchekon, 1999: Anderson, 1995, p. 33 *; Robinson, 2006). As a result, political repression and political laziness often run rampant. Under these circumstances the incumbent party is almost always re-elected because of the appeasive payoffs that they are able to finance from resource wealth (Wantchekon, 1999, p. 20). Unreasonably low taxes, subsidized employment and other such policies are the usual culprits (Anderson, 1995, p. 32; Robinson, 2006 *) . Furthermore, these types of policies are almost always adverse to the long-term interests of the economy and society- yet somehow they are still almost always employed. This has the eventual effect of creating voter apathy- or at least citizen apathy.
Because the incumbent leadership tends to stay in control, power is consolidated into one group, effectively creating a single-party dictatorship (Wantchekon, 1999, p.20-21 *: Robinson, 2006). Dictatorial regimes trivially make transitions to democracy very hard, therefore, this consolidation of power impedes the development of democracy.
In such cases, it is not uncommon for the ruling regime to forgo constitutional measures in to accumulate personal wealth... (Caselli, 2006; Lam et al., 2002, p. 10). Even under benevolent leadership, the government may see to forgo constitutional measures to expedite production in an attempt to boost economic growth- an act that in their view would be in the best interest of society (Norman, 2001, p. 11).
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