Toward an Alternative Explanation for the Resource Curse: Natural Resources, Immigration, and Democratization

Abstract

Why do many resource-rich countries maintain autocratic political regimes? The authors’ proposed answer focuses on the causal effect of labor imports, or immigration. Using the logic offered by Acemoglu and Robinson’s democratization model, the authors posit that immigration makes democratization less likely because it facilitates redistributive concessions to appease the population within an autocratic regime. This immigration argument applies directly to the political resource curse since many resource-rich countries tend to also be labor scarce, leading them to import foreign laborers. Consistent with this understanding, the authors find a statistically significant negative relationship between net immigration per capita and democratization in future periods. Their results also show that when controlling for this immigration effect, the standard resource curse variables lose significance in a democratization model. This latter result suggests that much of the so-called resource curse stems not from resource endowments per se but rather from the labor imports related to resource production.