[sho]

Thanks for mentioning that theory, yeah I'd heard about it.

I don't really buy it, though. It strikes me as being too cute by half and I can think of any number of counterexamples. For example, Norway, Canada and Australia have immense resource wealth per capita and no-one would say they're bad places to live. And Canada has 3x Russia's oil reserves, with 1/5th the population!

I think resource wealth is just a multiplier. If you have a bad government, it can make it even worse, but with good management it can provide a useful flow of income.

[berntb]

I think there is some benchmark that a country doesn't become a democracy if it has a certain percentage of export income from natural resources.

Norway was a democracy before the oil income. (I don't know about export incomes and Canada/Australia. Do they get most income from that?)

Edit: Syntax, so it will parse in your brain.

[sho]

Well, I don't know about Canada but in AU there's a mining lease fee, then corporate and income tax, then ownership restrictions (majority local ownership of shares). The government certainly gets its pound of flesh, in fact we're running our first deficit in 15 years mainly because commodity income is down, heh.

But yeah, good point on being a democracy before the money started to flow. That might indeed be the key. Resource income enables an otherwise uncompetitive, poorly-run country to keep its head above water, and sustain the worst sort of government even in the absence of advanced industry. And Russia is certainly pumping its oil as fast as it possibly can.

Who knows though. A bit of oil money would probably help North Korea. At least they'd have something to trade, some link to the outside world, some foreign currency to buy food. That's what I don't like about nice neat theories like that - they try to simplify the inherently unsimplifiable ..

[berntb]

You could mangle/simplify the "resource curse" theory:

1. Liberal democracy. Economy works more or less, so the leaders have lots to stea.. tax.

2. Dictator. Most everything, including citizens, belong to the dictator. Bad economy and dangerous, since dictators must have external enemies (so all complaints are treason).

3. A country with natural resources. There is no need for leaders to go to 1, since there is enough to steal anyway. Keep people down and fill the Swiss account as long as possible.

This categorization explain why democratizing has gone up for a few decades.

Model "1" generally gives more to steal for the politicians, even though they can only get part of the country. "2" is the only alternative if most people (would) hate the dictator if they got free media. See North Korea. Iran is an obvious example of model "3".

(The only country I can mention that doesn't fit the [broad] categories is China, but they start far back so give them time.)

Point is, oil would help NK's dictators but not anyone else.