Is Aid Oil?

• In Event: The Micro-level Politics of the Resource Curse

Abstract

The idea of a resource curse has been applied to multiple forms of unearned revenues, including both foreign aid and mineral wealth like oil. While recent work examines whether there are country-level differences across states that rely on each form of windfalls, there is little work examining whether, at the micro level, the resource curse operates differently for aid and oil. This paper argues that there are theoretical reasons to expect aid and oil to affect citizens’ preferences in systematically different ways. For example, citizens may have different levels of concern regarding misappropriation of each revenue source, or have different beliefs about the extent to which they are likely to – or even deserve to – benefit from such spending. These may in turn lead aid an oil to have different effects on citizen behavior, including willingness to monitor the budget or demand accountability from leaders. We test these possibilities using data from Uganda and Ghana, two countries that have both aid and oil revenues. We combine survey data on both citizens and elites with laboratory data on citizens to test whether, at the individual level, aid and oil are likely to have different effects on state-society relations.

Authors

• Lucy E. S. Martin, University of North Carolina, Chapel Hill

• Brandon de la Cuesta, Princeton University

• Helen V. Milner, Princeton University

• Daniel L. Nielson, Brigham Young University