The political economy of resource-driven growth

In recent decades, resource-poor countries have out-performed resource-abun dant ones. A stylised facts model of competitive industrialisation describe s the long-run development of a resource-poor country -with a political st ate that is developmental. Only minor change is required to adapt the model to trace the development trajectory of a resource-abundant country with a similar political state. However, most resource-abundant countries engender a political state that is factional or predatory and distorts the economy in the pursuit of rents. A staple trap model describes the development traj ectory under these conditions. The model predicts a growth collapse from wh ich recovery is protracted, especially for small economies that lack a nich e trade link with a large economy. (C) 2001 Elsevier Science B.V. All right s reserved.