By Mohammed Ali Alayli Professor Karp EEP 131 December 4, 2005
Abstract: The natural preference abhorrence represents an enormous impediment to development. Yet it is important to realize that it is not natural resources that are the problem; rather, it is lack of good political science and democracy. Remedying this institutional failure requires changes of law and practice but does not require huge resource investments. The most interesting opinion of the resource loathing is not that natural resource wealthiness on add up reduces growth, but that the economic and political resolution is so distinct in different resource ample countries. To understand the resource verify one needs to strike how economic factors shape institutions and how institutions shape economic factors. By change magnitude the foil of resource payments by firms to governments, increasing government transparency in the management of resource revenues, encouraging preventive diplomacy, curtail the trade of high-risk, and conflict-related commodities, income from these natural resources can be used to life growth and development.
One of the puzzling regularities of economic growth is that galore(postnominal) countries rich in natural resources have such(prenominal) low growth performance.
This occurs because the income from these resources is often misappropriated by corrupt leadership and officials instead of being used to support growth and development. Moreover, such wealth often fuels internal grievances that cause conflict and cultivated war. This pattern is widely referred to as the natural resource curse -- natural resource wealth creates stagnation and conflict, rather than economic growth and development. The most interesting aspect of the resource curse is not that natural resource wealth on average reduces growth, but that the economic and political outcome is so different in different resource abundant countries. To understand the resource curse...If you want to get a full essay, order it on our website: Orderessay
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