Resource abundance and public finances in five peripheral economies, 1850s–1930s
(2022) In Resources Policy 76.- Abstract
The resource curse literature has established that taxation of natural resources might limit the long-term development of fiscal capacity in resource-rich countries. This article explores if, and how, natural resource abundance generates fiscal dependence on natural resource revenues. We compare five peripheral economies of Latin America (Bolivia, Chile, Peru) and Scandinavia (Norway, Sweden) over a period of 90 years, between 1850 and 1939. Both groups were natural resource abundant, but in the latter natural resource dependence decreased over time. By using a novel database, we find that fiscal dependence was low in Norway and Sweden, while high and unstable in Bolivia, Chile and Peru. This suggests that natural resource abundance... (More)
The resource curse literature has established that taxation of natural resources might limit the long-term development of fiscal capacity in resource-rich countries. This article explores if, and how, natural resource abundance generates fiscal dependence on natural resource revenues. We compare five peripheral economies of Latin America (Bolivia, Chile, Peru) and Scandinavia (Norway, Sweden) over a period of 90 years, between 1850 and 1939. Both groups were natural resource abundant, but in the latter natural resource dependence decreased over time. By using a novel database, we find that fiscal dependence was low in Norway and Sweden, while high and unstable in Bolivia, Chile and Peru. This suggests that natural resource abundance should not be mechanically linked to fiscal dependence. An accounting identity shows that sudden increases in fiscal dependence were related to both economic and political factors: countries’ economic diversification, and attitudes of the relevant political forces about how taxation affects the companies operating in the natural resource sector.
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- author
- Peres-Cajías, José ; Torregrosa Hetland, Sara LU and Ducoing, Cristian LU
- organization
- publishing date
- 2022-06
- type
- Contribution to journal
- publication status
- published
- subject
- keywords
- Natural Resources curse, Latin America, Taxation, Scandinavia, fiscal contract, Rentier State
- in
- Resources Policy
- volume
- 76
- article number
- 102539
- publisher
- Elsevier
- external identifiers
-
- scopus:85122640846
- ISSN
- 0301-4207
- DOI
- 10.1016/j.resourpol.2021.102539
- project
- Sustainable development, Fiscal policy and Natural resources management. Bolivia, Chile and Peru in the Nordic countries’ mirror
- Taxing for the welfare state: public finances and progressivity in the rise of social spending (1910-1970)
- Taxing for the welfare state: progressivity in the rise of social spending (1910-1970)
- language
- English
- LU publication?
- yes
- id
- 7358d1dc-c309-4b64-ab23-d293371f7e42
- date added to LUP
- 2021-12-27 21:24:55
- date last changed
- 2022-05-09 20:18:51
@article{7358d1dc-c309-4b64-ab23-d293371f7e42,
abstract = {{<p>The resource curse literature has established that taxation of natural resources might limit the long-term development of fiscal capacity in resource-rich countries. This article explores if, and how, natural resource abundance generates fiscal dependence on natural resource revenues. We compare five peripheral economies of Latin America (Bolivia, Chile, Peru) and Scandinavia (Norway, Sweden) over a period of 90 years, between 1850 and 1939. Both groups were natural resource abundant, but in the latter natural resource dependence decreased over time. By using a novel database, we find that fiscal dependence was low in Norway and Sweden, while high and unstable in Bolivia, Chile and Peru. This suggests that natural resource abundance should not be mechanically linked to fiscal dependence. An accounting identity shows that sudden increases in fiscal dependence were related to both economic and political factors: countries’ economic diversification, and attitudes of the relevant political forces about how taxation affects the companies operating in the natural resource sector.</p>}},
author = {{Peres-Cajías, José and Torregrosa Hetland, Sara and Ducoing, Cristian}},
issn = {{0301-4207}},
keywords = {{Natural Resources curse; Latin America; Taxation; Scandinavia; fiscal contract; Rentier State}},
language = {{eng}},
publisher = {{Elsevier}},
series = {{Resources Policy}},
title = {{Resource abundance and public finances in five peripheral economies, 1850s–1930s}},
url = {{http://dx.doi.org/10.1016/j.resourpol.2021.102539}},
doi = {{10.1016/j.resourpol.2021.102539}},
volume = {{76}},
year = {{2022}},
}