Oil and the ‘new wars’: another look at the resource curse using alternative data

Abstract

The thesis that natural resources cause conflict is criticized on the basis that resource dependence and conflict are caused by other underlying factors and that the relationship is endogenous. Using disaggregated resource rents on per capita basis, a measure likely to be less influenced by endogeneity, this study finds that oil, rather than other resources, influenced the onset of civil war between 1970 and 2013. Granger causality shows no relationship between resource dependence, measured as resource rents per gross domestic product, and measures of resource rents per capita. Moreover, in multivariate models of societal violence measured by the Global Peace Index (GPI), which capture aspects of ‘new wars’ witnessed during the post-Cold War era, oil rather than minerals is what matters for predicting societal insecurity defined more broadly than just the absence of war. These results are upheld across subcomponents of the GPI, such as measures of crime, the ease of access of small arms and light weapons, political instability, and the repression of human rights. If oil wealth is associated with these maladies, even if it might not always correlate with war, can it still be asserted that oil is not a curse?