Economics of Peace: Can Extraction of Oil and Gas Lead to Sustainable Peace? (chapter in "Taxation and Management of Natural Resources in Africa")
Publisher: Advances in African Economic, Social and Political Development
Author(s): Zangina Isshaq, Mohammed Amidu, Aisha Mohammed Sissy, and Edward Asiedu
Date: 2024
Topics: Economic Recovery, Extractive Resources, Governance
Natural resource endowments and their association with poor economic performance have been likened to a curse. We ask whether natural resources are inimical to peace. In this chapter, we examine the implications of natural resource exploitation for sustainable peace. Use data from the recently available Global Peace Index scores to estimate models for Sub-Saharan African countries. We estimate models that include as explanatory variables total natural resources rents, rents from gas, oil, and mineral resources. We consistently find that only mineral resources show statistical significance related to peace index scores. Mineral resource exploitation is not conducive to peace. We also find that institutional quality, especially political stability, voice, and accountability, contribute to peace. Our results imply that mineral resources need a well-designed exploitation framework that generates economic opportunity, which can only be achieved with institutions equipped to deliver it. African government must take this task seriously.