Facebook Pixel Code
x
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.

The Resource Curse Hypothesis Essay Example

Show related essays

The Resource Curse Hypothesis

This is a preview of the 2-page document
Read full text

The Resource Curse Hypothesis. In the event of price fall for the natural resources, their ability to meet liability repayments will be condensed, and as a likely extra effect is a drop in the exchange rate. The incident has seen countries like Venezuela and Nigeria suffer a rapid increase of their debt burdens in the year 1980. During the period, many bankers refused to lend them and hence they fell into arrears. As a result, the two nations attracted huge penalties and sky-rocketing interest rates making their loan to grow more and more. In this case, economists agree that such countries will experience minimum growth in spite of their resource wealth.International analysts on political and economic issues observe the tendency of oil-rich nations to prompt international quarrel, or to be targeted thereof.

A good example of these nations is Saudi Arabia. When countries attract a bad label form the international community, they become a target of unfair foreign policies and economic sabotage. In the case of Saudi Arabia, its support for Iraq and Iran has been viewed with suspicion by the united state of America, Israel and other countries with military strength. Due to the suspicion, many countries have been influenced to give the country a hard economic time. Economic sanctions and export ban has been applied on Saudi Arabia. In this case, the country cannot fully utilize her natural resource endowment without friendly international policies. Therefore, Saudi Arabia will continue experiencing retarded economic growth despite owning huge oil deposits.Japan, though having little resources, has made tremendous steps in terms of development. One of the main reasons why Japan is outstanding in terms of economic growth is the fact that it has enjoyed peace and political stability for decades. In this case, it has established very close ties with economic powerhouses such as the USA and Israel. For this matter, Japan enjoys friendly foreign policies from these super economics. In the same way, South Korea and Indonesia have found favor in the eyes of the big economies. In this case, they experience high rate of economic growth despite fewer natural resources. The Resource Curse Hypothesis.

This is a preview of the 2-page document
Open full text

References

Dowd, K., & Hutchinson, M. (2010). Alchemists of loss how modern finance and government intervention crashed the financial system. Chichester: Wiley.

Top of Form

Bottom of Form

Dubofsky, M. (2013). The Oxford encyclopedia of American business, labor, and economic history. New York: Oxford University Press.

Chauffour, J. (2011). Trade finance during the great trade collapse. Washington, D.C.: World Bank

Top of Form

Bottom of Form

Helmer, J. (2010). Moon handbooks. Berkeley, CA: Avalon Travel.

Top of Form

Bottom of Form

Publishing, O., & Centre, O. (2011). Development in Eastern Europe and the South Caucasus. Paris: Organisation for Economic Co-operation and Development

Close ✕
Tracy Smith Editor&Proofreader
Expert in: Macro & Microeconomics, Human Resources, Management
Hire an Editor
Matt Hamilton Writer
Expert in: Macro & Microeconomics, E-Commerce, Finance & Accounting
Hire a Writer
preview essay on The Resource Curse Hypothesis
WE CAN HELP TO FIND AN ESSAYDidn't find an essay?

Please type your essay title, choose your document type, enter your email and we send you essay samples

Contact Us