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Norway and their trillion dollar sovereign fund may be the greatest counter example to the supposed resource curse in history. If they continue to manage it pro
by adventured 8y ago
Norway and their trillion dollar sovereign fund may be the greatest counter example to the supposed resource curse in history. If they continue to manage it properly, it's a conversion of oil (temporary resource) into immense, permanent national wealth.
- simonh 8y agoI think the resource cure is a real thing, but it depends who gets their hands on the resources first, i.e. how political power works when the resource becomes available. Australia, Canada And the USA were all democracies before they becane resource rich and always had highly diversified economies. The resource curse kicks in when you have a developing nation with autocratic political norms because the rulers keep the resources for themselves. Because democratic reform would mean giving up their exclusive grip on the resources, they use those resources to fight it. This can also lead to a slide to autocracy in democratic countries with weak institutions - see Venezuela.
- muro 8y agoLet's see how permanent the permanent wealth turns out to be. They seem to manage it better than other countries, but who knows, maybe on a long timeline, they are only spending it slower. I hope not, but so far, there have been so few examples of long term great management, that it's more likely it will end badly. They have a few benefits that imply it might work: culture of not showing off wealth; small population; well working justice system that should deal with corruption. Let's see in 50 to 100 years :)