Winning the Oil Lottery : The Impact of Natural Resource Extraction on Growth /

This paper provides evidence of the causal impact of oil discoveries on development. Novel data on the drilling of 20,000 oil wells in Brazil allows us to exploit a quasi-experiment: Municipalities where oil was discovered constitute the treatment group, while municipalities with drilling but no dis...

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Bibliographic Details
Main Author: Cavalcanti, Tiago
Other Authors: Da Mata, Daniel, Toscani, Frederik
Format: Journal
Language:English
Published: Washington, D.C. : International Monetary Fund, 2016.
Series:IMF Working Papers; Working Paper ; No. 2016/061
Online Access:Full text available on IMF
Description
Summary:This paper provides evidence of the causal impact of oil discoveries on development. Novel data on the drilling of 20,000 oil wells in Brazil allows us to exploit a quasi-experiment: Municipalities where oil was discovered constitute the treatment group, while municipalities with drilling but no discovery are the control group. The results show that oil discoveries significantly increase per capita GDP and urbanization. We find positive spillovers to non-oil sectors, specifically, an increase in services GDP which stems from higher output per worker. The results are consistent with greater local demand for non-tradable services driven by highly paid oil workers.
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Physical Description:1 online resource (34 pages)
Format:Mode of access: Internet
ISSN:1018-5941
Access:Electronic access restricted to authorized BRAC University faculty, staff and students