Paradox of Plenty or Oil Blessing? Counterfactual Evidence from Africa

• In Event: Pushing the Boundaries of the Resource Curse: New Directions in Oil and Politics

Abstract

Scholars of resource wealth and politics often argue, counterfactually, that developing states wind up worse off when they are oil-rich than they would be if they had never discovered oil. Still, direct explorations of the question are nonexistent and have yet to make use of the newest techniques for asking counterfactual questions. In this paper, we ask the question directly with regard to sub-Saharan Africa. We employ time-series data from all countries in Africa from 1950 to 2018, using the synthetic control method to ask: would today’s oil-rich African states enjoy better development outcomes if they had never found oil? Our results show that these countries would fare no better in aggregate development or human development outcomes had they never found oil. In the final section of the paper, we extend these results preliminarily to asking whether the same results obtain for oil’s relationship to either civil conflict or democracy, and we find strong suggestive evidence that the counterfactual absence of oil would not have improved these outcomes either. Our findings have important and, for the first time directly tested, implications for the study of resources and politics and for the development community.

Authors

• Muharrem Bagriyanik, University of Florida

• Ben Smith, University of Florida

• Adam Newman Bernstein