Resources and Incentives to Reform: A Model and Some Evidence on Sub-Saharan African Countries

43 Pages Posted: 31 Jan 2006

See all articles by Alberto Dalmazzo

Alberto Dalmazzo

University of Siena - Department of Economics

Guido de Blasio

Bank of Italy

Date Written: June 2001

Abstract

The paper models the incentives for a self-interested government to implement good policies. While good policies lead to investment and growth, they reduce the government's ability to increase supporters' consumption. The model predicts that resource abundance is conductive to poor policies and, consequently, to low investment. The implications of the model are broadly supported by evidence on sub-Saharan African countries. In particular, countries that are rich in natural resources tend to have lower institutional quality and worse macroeconomic and trade policies.

Keywords: Investment, autocracy, reforms

JEL Classification: D72, E22, Q33

Suggested Citation

Dalmazzo, Alberto and de Blasio, Guido, Resources and Incentives to Reform: A Model and Some Evidence on Sub-Saharan African Countries (June 2001). IMF Working Paper No. 01/86, Available at SSRN: https://ssrn.com/abstract=879620 or http://dx.doi.org/10.2139/ssrn.879620

Alberto Dalmazzo (Contact Author)

University of Siena - Department of Economics ( email )

Piazza S. Francesco, 7
Siena, I-53100
Italy
+39 0577 232 697 (Phone)

Guido De Blasio

Bank of Italy ( email )

Via Nazionale 91
00184 Roma
Italy

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