Author ORCID Identifier

https://orcid.org/0000-0003-2123-9689

Date of Award

Fall 1-9-2022

Degree Type

Dissertation

Degree Name

Doctor of Philosophy (PhD)

Department

Economics

First Advisor

Dr. Jorge Martinez-Vazquez

Second Advisor

Dr. Andrew Feltenstein

Third Advisor

Dr. Mark Rider

Fourth Advisor

Dr. Charles Hankla

Abstract

This dissertation comprises three essays on natural resources and decentralization. The first chapter of the dissertation estimates the causal impact of natural resources on economic growth and job creation or unemployment reduction in Ghana. There is a dearth of research on the impact of natural resources in developing countries because of the unavailability or the prohibitively costly nature of data acquisition in those countries. These hurdles present methodological challenges to conducting research in this area. We use an innovative approach – the synthetic control method for comparative case studies to circumvent these challenges. We exploit the quasi-experimental nature of the oil discovery in 2007 in Ghana and its subsequent production in Ghana and find that oil discovery and production has had a positive impact on economic growth and a negative impact on the reduction of unemployment. Over the period 2009-2018, GDP per capita increased by 501.11USD per year on average. This amounts to approximately 45.5% of the 2009 baseline level. During the end period of the analysis, which is 2018, the GDP per capita gap between Ghana and synthetic Ghana was about 950 USD. This implies that GDP per capita was 76% higher in the real Ghana relative to the synthetic Ghana. The average unemployment surge in Ghana between 2009-2018 following oil discovery was about 1.85%. This translates to 36.96% relative to the 2009 baseline unemployment level.

The second chapter of the dissertation examines the impact that a grapple over natural resource rents has on ethnic and tribal tensions and subsequent conflicts using a panel of African countries. We use the system GMM to get around the problem of endogeneity. We find out that natural resource rent exacerbates the risk of ethnic and tribal tensions and conflicts significantly. As a mediation policy, political and administrative decentralization have an impact in reducing the tensions generated by natural resource rents.

The last chapter of the dissertation explores the ability of fiscal decentralization in reducing the unemployment rate in countries. Using a panel dataset of some 51 countries across the world and geographic variables as instruments, we find out that fiscal decentralization has a significant impact on unemployment reduction. The results are robust across different checks and specifications. The instrumental variable approach helps to tackle the problem of endogeneity faced in empirical research.

DOI

https://doi.org/10.57709/32980052

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