Winning the Oil Lottery: The Impact of Natural Resource Extraction on Growth
Electronic Access:
Free Download. Use the free Adobe Acrobat Reader to view this PDF file
Summary:
This paper provides evidence of the causal impact of oil discoveries on development. Novel data on the drilling of 20,000 oil wells in Brazil allows us to exploit a quasi-experiment: Municipalities where oil was discovered constitute the treatment group, while municipalities with drilling but no discovery are the control group. The results show that oil discoveries significantly increase per capita GDP and urbanization. We find positive spillovers to non-oil sectors, specifically, an increase in services GDP which stems from higher output per worker. The results are consistent with greater local demand for non-tradable services driven by highly paid oil workers.
Series:
Working Paper No. 2016/061
Subject:
Commodities Economic sectors Environment Manufacturing Natural resources Oil Oil production Production Services sector
English
Publication Date:
March 14, 2016
ISBN/ISSN:
9781513587752/1018-5941
Stock No:
WPIEA2016061
Pages:
34
Please address any questions about this title to publications@imf.org