Nonrenewable Resources, Income Inequality and Per Capita GDP : An Empirical Analysis

This analysis examines the relationship between nonrenewable resource dependence, economic growth and income inequality. It uses a two-equation system in which the Gini index and GDP per capita are the dependent variables and the stock of nonrenewa...

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Main Authors:	Scognamillo, Antonio, Mele, Gianluca, Sensini, Luca
Format:	Working Paper
Language:	English en_US
Published:	World Bank, Washington, DC 2016
Subjects:	natural capital nonrenewable resources economic growth inequality income distribution
Online Access:	http://documents.worldbank.org/curated/en/2016/09/26805462/nonrenewable-resources-income-inequality-capita-gdp-empirical-analysis http://hdl.handle.net/10986/25147

id	okr-10986-25147
recordtype	oai_dc
spelling	okr-10986-251472021-04-23T14:04:29Z Nonrenewable Resources, Income Inequality and Per Capita GDP : An Empirical Analysis Scognamillo, Antonio Mele, Gianluca Sensini, Luca natural capital nonrenewable resources economic growth inequality income distribution This analysis examines the relationship between nonrenewable resource dependence, economic growth and income inequality. It uses a two-equation system in which the Gini index and GDP per capita are the dependent variables and the stock of nonrenewable resources as a share of national wealth -- i.e. resource dependence -- is the independent variable. Using a dataset that includes information on 43 countries from 1980 to 2012, this paper estimates several model specifications in order to check the robustness of the results under different assumptions and to account for income-group-related heterogeneity among countries. The baseline model provides strong evidence that natural resource dependence is negatively correlated with both per capita GDP and the Gini index; in other words, resource dependence is associated with lower income levels, but also with a more equal distribution of income. Interestingly, however, after controlling for country income group, the sign and magnitude of these relationships appear to become dependent on national-level structural characteristics. Among higher-income countries, greater nonrenewable natural resource dependence is associated with lower income inequality, while there is no statistically significant correlation with GDP per capita. Among the lower-income group, greater dependence on nonrenewable natural resources is associated with both higher levels of income inequality and lower per capita GDP. Further analysis focusing on a subsample of non-renewable resource rich countries confirms these findings. 2016-10-13T19:27:48Z 2016-10-13T19:27:48Z 2016-09 Working Paper http://documents.worldbank.org/curated/en/2016/09/26805462/nonrenewable-resources-income-inequality-capita-gdp-empirical-analysis http://hdl.handle.net/10986/25147 English en_US Policy Research Working Paper;No. 7831 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English en_US
topic	natural capital nonrenewable resources economic growth inequality income distribution
spellingShingle	natural capital nonrenewable resources economic growth inequality income distribution Scognamillo, Antonio Mele, Gianluca Sensini, Luca Nonrenewable Resources, Income Inequality and Per Capita GDP : An Empirical Analysis
relation	Policy Research Working Paper;No. 7831
description	This analysis examines the relationship between nonrenewable resource dependence, economic growth and income inequality. It uses a two-equation system in which the Gini index and GDP per capita are the dependent variables and the stock of nonrenewable resources as a share of national wealth -- i.e. resource dependence -- is the independent variable. Using a dataset that includes information on 43 countries from 1980 to 2012, this paper estimates several model specifications in order to check the robustness of the results under different assumptions and to account for income-group-related heterogeneity among countries. The baseline model provides strong evidence that natural resource dependence is negatively correlated with both per capita GDP and the Gini index; in other words, resource dependence is associated with lower income levels, but also with a more equal distribution of income. Interestingly, however, after controlling for country income group, the sign and magnitude of these relationships appear to become dependent on national-level structural characteristics. Among higher-income countries, greater nonrenewable natural resource dependence is associated with lower income inequality, while there is no statistically significant correlation with GDP per capita. Among the lower-income group, greater dependence on nonrenewable natural resources is associated with both higher levels of income inequality and lower per capita GDP. Further analysis focusing on a subsample of non-renewable resource rich countries confirms these findings.
format	Working Paper
author	Scognamillo, Antonio Mele, Gianluca Sensini, Luca
author_facet	Scognamillo, Antonio Mele, Gianluca Sensini, Luca
author_sort	Scognamillo, Antonio
title	Nonrenewable Resources, Income Inequality and Per Capita GDP : An Empirical Analysis
title_short	Nonrenewable Resources, Income Inequality and Per Capita GDP : An Empirical Analysis
title_full	Nonrenewable Resources, Income Inequality and Per Capita GDP : An Empirical Analysis
title_fullStr	Nonrenewable Resources, Income Inequality and Per Capita GDP : An Empirical Analysis
title_full_unstemmed	Nonrenewable Resources, Income Inequality and Per Capita GDP : An Empirical Analysis
title_sort	nonrenewable resources, income inequality and per capita gdp : an empirical analysis
publisher	World Bank, Washington, DC
publishDate	2016
url	http://documents.worldbank.org/curated/en/2016/09/26805462/nonrenewable-resources-income-inequality-capita-gdp-empirical-analysis http://hdl.handle.net/10986/25147
_version_	1764458669855997952

Nonrenewable Resources, Income Inequality and Per Capita GDP : An Empirical Analysis

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