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On the political economy of resource rents in polarized societies

Bjorvatn, Kjetil
Working paper
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URI
http://hdl.handle.net/11250/163048
Date
2007-01
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  • Discussion papers (SAM) [608]
Abstract
The present paper analyses how resource rents may affect political

outcomes in a polarized society, where groups hold conflicting views

on economic policy. A politically dominant group decides whether or

not to include the opposition in the national political process. The

weaker group chooses whether to remain in the union or secede. The

analysis finds that the effect of resource rents on social and political

outcomes depends on the social environment, in particular the degree

of polarization in society. Moreover, the study shows that this relationship

may be non-monotonic, with increases in resource wealth

stimulating peaceful cooperation for some initial levels of wealth, and stimulating conflict and division for other initial levels of wealth.
Publisher
Norwegian School of Economics and Business Administration. Department of Economics
Series
Discussion paper
2007:2

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