Petro Populism

Arbeitspapier

We aim to explain petro populism - the excessive use of oil revenues to buy political support. To reap the full gains of natural resource income politicians need to remain in office over time. Hence, even a purely rent-seeking incumbent who only cares about his own welfare, will want to provide voters with goods and services if it promotes his probability of remaining in office. While this incentive benefits citizens under the rule of rent-seekers, it also has the adverse effect of motivating benevolent policymakers to short-term overprovision of goods and services. In equilibrium politicians of all types indulge in excessive resource extraction, while voters reward policies they realize cannot be sustained over time. Our model explains how resource wealth may generate political competition that reduces the tenability of equilibrium policies.

Object Details

• ISBN: 978-82-7553-670-7
• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Working Paper ; No. 2012/06

Classification and Topics

• Classification: Wirtschaft ; Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior ; Economic Development: Agriculture; Natural Resources; Energy; Environment; Other Primary Products ; Resource Booms
• Subject: resource curse ; political economy

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Matsen, Egil ; Natvik, Gisle James ; Torvik, Ragnar
• Event: Veröffentlichung
• (who): Norges Bank
• (where): Oslo
• (when): 2012

Further information

• Handle: http://hdl.handle.net/10419/210005
• Last update: 10.03.2025, 11:41 AM CET