20 Dec 2016 | Publication

 Resource Abundance and Resource Dependence

 Authors: Abdul Ghafar Ismail, Khairil Anuar Ramli (2016)

 IESTC Working Paper Series: No. 2

 

 

Citation style: Abdul Ghafar Ismail and Khairil Anuar Ramli (2016) Resource Abundance and Resource Dependence. IESTC Working Paper Series, Working Paper No. 1. Bangi: Islamic Economic Studies and Thoughts Centre

 

Abstract

Researchers acknowledge that many Muslim countries have a resource abundant economy; nonetheless, questions arise as to whether they are also resource-dependent. In certain extent that their economic performance is heavily anchored upon the performance of its extractive industries. This article aims to explore basic issues surrounding the schisms of resource abundance and dependence – its value as resource rents, its roles as a natural capital, its market price volatility and its oft-mentioned linkages with economic performances. To contextualize the issues, this research traces the brief historical milestones in the development of an oil and gas industry in Malaysia, and devours its financial and operational indicators in comparison with other resource-rich economies. It raises issues such as whether a nation should pursue a resource-led industrialization.

 

Keywords: resource economics, resource curse, resource abundance, resource dependence, economic development

JEL Classification: O11; O13; Q32; Q38; Q43.

 

References

 

Azarchs, T. & Khitarishvili, T. 2010. Disaggregating the Resource Curse: Is the Curse More Difficult to Dispel in Oil States than in Mineral States? Working Paper No. 641. Levy Economics Institute of Bard College, New York. December 2010.

BP Statistical Review of World Energy. 2015. Website: www.bp.com/statisticalreview.

Collier, P. & Venables, A.J. (eds.). 2011. Plundered Nations? Successes and Failures in Natural Resource Extraction. London: Palgrave MacMillan.

Doraisami, A.. 2015. Has Malaysia really escaped the resource curse? A closer look at the political economy of oil revenue management and expenditures. Resource Policy. 45, 98-108.

Economic Planning Unit. 1976. Third Malaysia Plan 1976-1980. Kuala Lumpur: National Printing Department.

Gebb, A. H. (ed.). 1988. Oil Windfalls: Blessing or Curse? A World Bank Research Publication. Washington: Oxford University Press.

Hartwick, J. M.. 1977. "Intergenerational Equity and the Investment of Rents from Exhaustible Resources" American Economic Review, 67, December, pp. 972-74.

Hertog, S.. 2010. Defying The Resource Curse: Explaining Successful State-Owned Enterprises in Rentier States. World Politics. 62(2), 261-301.

Humphreys, M., Sachs, J. D., & Stiglitz, J. E. (eds.). 2007. Escaping the Resource Curse. New York: Columbia University Press.

Kolstad, I. & Wiig, A.. 2008. Political Economy Models of the Resource Curse: Implications for Policy and Research. CMI Working Papers. Norway: Chr Michelsen Institute.

Kronenberg, T.. 2004. The curse of natural resources in the transition economies. Economics of Transition. 12(3), 399-426.

Kunchu, J.A.B. & Sarmidi, T.. 2015. Sumpahan Sumber Alam dan Modal Insan: Satu Penilaian Semula. Jurnal Ekonomi Malaysia. 49(1), 83-92.

Kulkarni, K. G., Brijesh P., & Jha, A. K.. 2009. “Dutch Disease” and Indian Trade Policy. SCMS Journal of Indian Management. October-December.

Mason, Charles F.. 2013. The Battle for Control of Global Crude Oil Markets: OPEC and the Seven Sisters. Chapter 7 in Maillet, S. A. and Valcourt, L. C. (eds.) (2013) Natural Resources: Conservation Strategies, Globalisation and Politics, and Sustainable Uses. New York: Nova Publishers.

PETRONAS Annual Report 2014.

Petroleum Development Act 1974 (Act 144). 2003. Petroleum Legislation in Malaysia. Petaling Jaya: International Law Book Services.

Ross, M.. 2012. The Oil Curse: How Petroleum Wealth Shapes the Development of Nations. Princeton: Princeton University Press.

Sachs, J. D. & Warner, A. M.. 1995. Natural Resource Abundance and Economic Growth. National Bureau of Economic Research (NBER). Working paper 5398.

Sachs, J. D. & Warner, A. M.. 1997. Natural Resource Abundance and Economic Growth. Harvard University.

Sachs, J. D. & Warner, A.M.. 2001. The Natural Resources and Economic Development: The curse of natural resources. European Economic Review. 45, 827-838.

Stevens, P., Lahn, G & Kooroshy, J.. 2015. The Resource Curse Revisited. Research Paper. The Royal Institute of International Affairs. London.

Tertzakian, P.. 2015. A Thousand Barrels a Second: The Coming Oil Break Point and the Challenges Facing an Energy Dependent World. New York: McGraw-Hill.

UNCTAD. 2015. UNCTAD Handbook of Statistics. New York: UNCTAD.

World Bank. 1997. Expanding the Measure of Wealth: Indicators of Environmentally Sustainable Development. Washington, DC.

World Bank. 2006. Where Is the Wealth of Nations? Measuring Capital for the 21st Century. Washington, DC.

World Bank. 2011. The Changing Wealth of Nations: Measuring Sustainable Development in the New Millennium. Washington, DC.

World Bank. 2013. Harnessing Natural Resources. Malaysia Economic Monitor, June 2013.

Yusof, Z. A.. 2011. Malaysia: The Developmental State. pages 188- 230, in Collier, P. & Venables, A.J. (eds.). 2011. Plundered Nations? Successes and Failures in Natural Resource Extraction. London: Palgrave MacMillan.