Botswana is typical of the countries that are endowed with abundant natural resources. Although it is commonly accepted that resource-rich economies tend to fail in accelerating growth, Botswana has experienced the most remarkable economic performance in the region. Using the latest cross-country data, this study empirically readdresses the question of whether resource abundance can contribute to growth. It finds that governance determines the extent to which the growth effects of resource wealth can materialize. In developing countries in particular, the quality of regulation, such as the predictability of changes of regulations, and anticorruption policies, such as transparency and accountability in the public sector, are most important for effective natural resource management and growth.(2) [1 is obtained as a residual from the following transmission channel equation: TOT : 7/0 + 7/1MIN + , u (3) where TOT denotes a change in terms of trade.21 B. Econometric Issues The most important econometric issue in estimating Equations (1) through (3) with aggregated ... The original variables for the period from 1998 to 2002 are instrumented by the lagged equivalents from 1992 to 1996 . Anotheranbsp;...
|Title||:||Did Botswana Escape From the Resource Curse?|
|Publisher||:||International Monetary Fund - 2006-06-01|