Developing Countries Experience A Natural Resource Curse

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Explain why some developing countries experience a “natural resource curse” and evaluate the strategies that they can implement to avoid it. The natural resource curse, or the paradox of plenty , is the paradoxical idea that countries and areas with many available natural resources, more specifically non-renewable resources such as minerals and fuels, often tend to have less economic growth and slower development levels than countries with fewer natural resources. It was first noted in 1995 when Jeffrey Sachs and Andrew Warner found a negative relationship between natural resources and economic growth, leading many economists to accept that natural resources might be an obstacle to economic development. Examples of this economic theory are evident in resource rich areas of Africa which, when compared to countries in Europe, are incredibly underdeveloped both socially and economically. Through this essay I will not only seek to explain the reasons behind the natural resource curse, but also to evaluate the possible strategies that could be implemented to avoid it and its effects. There are many reasons behind this economic effect, but arguably the main reason behind the Natural Resource Curse in a given country is the country’s reliance on the export of the raw resources. Because the resource extraction involved in this trade often entails little job creation, unemployment rises as the country focuses all of its efforts on the raw materials and at the same time the
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