The Principal Findings and some Policy Implications

Abstract

The resource curse is part of a broader rent curse linked to geopolitical rent, regulatory rent, and labour rent, as well as natural resource rent. Variation in the intensity of rent curse effects reflects major shifts in policy fashion. It declined with the post-1980s dismantling of industrialization by import substitution. Previously, low rent incentivized the pursuit of policies promoting efficient economic growth under hard budget constraints in East Asia and Mauritius (and now in Bangladesh, Vietnam, and the Philippines). High rent in Latin America and sub-Saharan Africa led to staple trap trajectories associated with protracted growth collapses. However, labour surplus South Asia and the Gulf states can learn from policy errors to, respectively, pursue labour-intensive growth and merge dualistic labour markets as part of a package of sector neutral policies, macroeconomic stability, and an enabling environment.