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natural-resource-curse
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Exploring Economic Performance of Resource-Rich Countries by Separating their Political Systems
, M.Sc. Thesis Sharif University of Technology ; Nili, Masoud (Supervisor)
Abstract
Economic performance of resource rich countries is related to their political systems. In this research, consistent to Hosseini (1388), we develop a theoretical model in which we classify the political systems of those countries to four systems based on corruption, myopic behavior of the incumbent, ideological bias of people, and the popularity shocks in elections. We show that in a fixed institutional framework, democracy leads to higher welfare for people and better economic performance. However, in a society with low corruption, high political convergence, and low popularity shocks both democracy and dictatorship maximize the social welfare in the model
The Effect of Political Systems on Economic Performance in Resource-Rich Countries
, M.Sc. Thesis Sharif University of Technology ; Nili, Farhad (Supervisor) ; Nili, Masoud (Co-Advisor)
Abstract
In this research, the effect of political system on economic performance of resource abundant countries is studied. We use political economy litreture to develop a theoritical model in this issue. Here, the politcal systems are divided to democracy and dictatory and in each of them other institutional variable will be introduced. Policy indicator is based on the difference between social welfare in each situation and its optimal amount when maximized. We show that if democracy does not come with high accountability it reduces social welfare more than dictatory. Also, if politician are myopic, democracy aggravates economic performance in those countries. In addition, easy access to income...
The Effect of Oil Abundance on the Relationship between Growth and Inequality
, M.Sc. Thesis Sharif University of Technology ; Nili, Farhad (Supervisor)
Abstract
Empirical results in this research show that oil abundance in an economy tends to increase income inequality. Three mechanisms: Trade, civil liberties and imperfections of financial markets can explain this empirical finding, with the first being an alternative explanation for the Dutch disease. Besides, due to the influence it could have on parents underestimating the future costs of their children and because of the rents it produces, Oil abundance could reduce the opportunity cost of having children which results in a higher fertility rate. Moreover, empirical results confirm the negative relation between inequality and growth through the fertility mechanism. Therefore apart from...
Political Economics of Resource Curese with Respect to State Owned Enterprises
, M.Sc. Thesis Sharif University of Technology ; Nili, Masoud (Supervisor)
Abstract
The low performance of the natural resource economies in terms of economic growth has been considered in different fields of social sciences recently. Variety of policies suggested escaping from this phenomenon with respect to different standpoints. In this research, based on a theoretical approach, we tried to model the leader and people’s behavior in resource rich countries with political economics viewpoint and rational players. The contribution of this research is the introduction of state owned enterprises (SOE) as a basis to resource curse, which has not been considered precisely before. In our model, we have two players (leader, people), two alternatives for resource allocation...
On the Effects of Change in the Ownership of Natural Resource Revenues on Government Performance Enhancement and People Welfare
, M.Sc. Thesis Sharif University of Technology ; Nili, Masoud (Supervisor)
Abstract
The poor economic performance of natural resource abundant countries has been studied for a long time and in order to alleviate this problem some different solutions are suggested by economists. One stream among these solutions are those focusing on the distribution mechanism of natural resource revenues and the ownership of these resources. In this study, it is intended to address the effect of change in the ownership of natural resources on politicians’ behavior and people welfare by using political economy approach. Also the optimal share of people from natural resources as a function of political and economic institutions is discussed. In this study, it is shown theoretically that under...
The Impact of Oil Dependence on Institutional Quality
,
M.Sc. Thesis
Sharif University of Technology
;
Nili, Farhad
(Supervisor)
;
Abedini, Javad
(Supervisor)
Abstract
Institution covers wide range of rules, laws and policies. Two bodies of literature around institutions and resource curse have evaluated institutional quality by limited indices. In addition, although different institutions have different effects on economy, the literature hasn’t classified different kinds of institution. Furthermore, resources can affect institutions in different ways. This research has been surveyed the impact of resource dependence on institutional quality. Institutions that regulate relation between governors and citizens were named governmental institutions. Institutions that regulate the relation of citizens were named nongovernmental institutions. Governmental...
The Effects of Oil Wealth on the Protection of Property Rights in the Oil Countries
, M.Sc. Thesis Sharif University of Technology ; Nili, Masood (Supervisor)
Abstract
Using a panel dataset of oil discoveries and oil prices, this thesis studies the effect of oil wealth on protection of property rights in 56 oil countries between 1995 to 2018. Controlling for year fixed effects and country fixed effects, We show that this association is affected by the ownership of oil in this countries. In countries that government is owned all the oil industry, a strong correlation is observable between oil wealth and property rights policies. But in countries that private ownership on oil is legal and the government is not monopolist in the oil ownership, this correlation is insignificant. This results are robust with controlling the GDP per capita, political regime...
Economic Misconceptions and Growth Destrcution in Resource-abundant Democracies
, M.Sc. Thesis Sharif University of Technology ; Nili, Masoud (Supervisor)
Abstract
This paper develops a theoretical model based on economic misconceptions to explain the stylized facts of unsatisfactory long-term economic growth rates. Should the economic agents lack sufficient public understanding of economics, office-seeking politicians can take advantage of the situation and adopt populistic policies to get elected into office. Undermined economic growth is the price society pays for its ignorance. This mechanism is most relevant in democratic resource-abundant countries suffering from weak institutions. That is because natural resource price fluctuations make it more challenging to distinguish politicians’ performance and exogenous economic shocks, translating...
Political Economy of White Elephants in Oil Exporting Countries
, M.Sc. Thesis Sharif University of Technology ; Nili, Masoud (Supervisor)
Abstract
The procyclical behavior of public investment expenditure in OECs is one of the main channels through which the blessing of the natural resource abundance turns into a curse. The focal issue about the public investment expenditures in OECs is the misallocation and the inefficiency of these expenditures which often appear in the form of white elephants- i.e. government investment projects with large scale and high social/political prestige for the politicians implementing theme, but with negative economic return- especially in the oil booms. Moreover, the imprical evidence shows that the efficiency of public investment management in OECs is positively and significantly correlated with the...
Subsidy and natural resource curse: evidence from plant level observations in Iran
, Article Resources Policy ; Volume 52 , 2017 , Pages 90-99 ; 03014207 (ISSN) ; Karimirad, A ; Sharif University of Technology
Abstract
Using plant level panel data of manufacturing firms in Iran from 2003 to 2013, we test the Dutch disease predictions, including the impact of a rise in oil prices on intensive and extensive margins of trade. Our findings indicate that during periods of high oil prices domestic currency appreciates, but contrary to resource curse theories, domestic firms export more, and new firms enter foreign markets. We reconcile this paradox by proposing a new channel, which we call “subsidy disease.” Despite rising oil prices, the government of Iran kept domestic energy prices at low levels, which increased the implicit subsidy accruing to energy intensive firms. In effect, these firms gain a competitive...