Natural resource dependence is measured by the share of natural capital in national wealth in 1994 i.e., the share of natural capital in total capital, which comprises physical, human and natural capital (but not social capital). The natural capital variable used here is close to the source: it is intended to come closer to a direct measurement of the intensity of natural resources across countries than the various proxies that have been used in earlier studies, mainly the share of primary (i.e., nonmanufacturing) exports in total exports or in gross domestic product and the share of the primary sector in employment or the labor force. The latter proxies may be prone to bias due to product and labor market distortions.

For more on the relationship between natural resources and growth, see, for example, the papers listed here

Go back to Pictures of growth