Natural Resources Curse in the long run? Bolivia, Chile and Peru in the Nordic countries’ mirror

Abstract

Abstract:The new estimates of the Maddison Project show that the p.p.p. GDP per capita ratio between Bolivia and Finland has changed from 0.68 ca. 1850 to 0.16 in 2015; similarly, that between Chile and Norway from 0.65 to 0.28. The aim of this article is to present a review of the literature and available quantitative evidence to understand how these extreme differences became possible between countries with similarly enormous natural resources endowments. Specifically, the article seeks to a) identify some stylised facts that may help understand the divergence between Andean and Nordic countries; b) highlight research questions that will guide further work about the divergent effect of natural resource abundance in Andean and Nordic economies. In order to achieve these objectives, four topics are covered: GDPpc, population, trade and taxation. The analysis comprises three Nordic countries (Finland, Norway, and Sweden) and three Andean countries (Bolivia, Chile, and Peru) from the mid-nineteenth century to present day. The sample size, time span covered and thematic approach provide new evidence regarding previous work. [1][2][3]