Resource Rich, Cash Poor

Joseph Stiglitz, the noted economist, writing at Slate:

On average, resource-rich countries have done even more poorly than countries without resources. They have grown more slowly and with greater inequality—just the opposite of what one would expect. After all, taxing natural resources at high rates will not cause them to disappear, which means that countries whose major source of revenue is natural resources can use them to finance education, health care, development, and redistribution.

I would say the United States and Canada are two examples of resource-rich countries that have escaped this quandary. But there are lots more that haven’t.

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