Ross 1999 Flashcards
What broad research question does Ross (1999) address?
A. How does a country’s resource wealth influence its economic development?
B. How does a country’s resource wealth influence its likelihood of transitioning to democracy?
C. How does a country’s resource wealth influence its citizens’ life expectancy and education attainment?
D. All of the above
A. How does a country’s resource wealth influence its economic development?
What is the explanatory variable of interest in the studies reviewed by Ross (1999)?
A. Regime type
B. Natural-resource wealth
C. Institutions
D. Economic growth
B. Natural-Resource wealth
What is the outcome variable of interest in the studies reviewed by Ross (1999)?
A. Regime type
B. Natural-resource wealth
C. Institutions
D. Economic growth
A. Regime type
According to Ross (1999), what did economists in the 1950s think about the prospects for economic growth in resource-rich states?
A. They were optimistic because they expected that natural resources would help fund physical capital investment and provide financing for public goods.
B. They were optimistic because they thought that resource extraction would attract external investment.
C. They were pessimistic because they were aware of the dangers of the resource curse and feared that resource-rich countries would be exploited by Western states.
D. Both A and B
A. They were optimistic because they expected that natural resources would help fund physical capital investment and provide financing for public goods.
According to Ross (1999), what policy solutions can governments adopt to protect their economies against Dutch Disease and other problems associated with the resource curse?
A. Put money in stabilization funds in order to avoid exchange rate appreciation.
B. Put careful fiscal policies in place to prevent government overspending.
C. Invest in other sectors in order to diversify the economy.
D. All of the above
D. All of the above
According to Ross (1999), what is a “rentier state”?
A. A state rich in natural resources that can therefore rent its extraction sites to international corporations
B. A state poor in natural resources that receives a lot of foreign aid (i.e., a “rent”)
C. A state that finances itself through “rent-like” revenues such as natural resources and/or foreign aid, and that does not depend on revenues raised directly from its citizens (e.g., taxes)
A developed state poor in natural resources that must rent extraction sites from resource-rich developing countries
C. A state that finances itself through “rent-like” revenues such as natural resources and/or foreign aid, and that does not depend on revenues raised directly from its citizens (e.g., taxes)
What does Ross (1999) mean by the “problem of linkages”?
A. Ross is essentially referring to the problem of the broken fiscal contract in resource-rich states where citizens do not hold their governments accountable for how natural resource revenues are utilized.
B. Ross is essentially referring to enclave economies where economic actors in the natural resource sectors tend not to take their earnings and invest them in other industries.
C. Ross is essentially referring to Dutch disease, where being rich in natural resources tends to lead to a country’s exports becoming too expensive.
D. All of the above are part of “the problem of linkages.”
B. Ross is essentially referring to enclave economies where economic actors in the natural resource sectors tend not to take their earnings and invest them in other industries.
According to Ross (1999), how could the “problem of linkages” be addressed?
A. By putting money in stabilization funds in order to avoid exchange rate appreciation
B. By putting careful fiscal policies in place to prevent government overspending
Correct!
C. By nationalizing natural resource extraction and export so as to allow the government to use natural resource revenues for investment elsewhere in the economy
D. Both A and B
C. By nationalizing natural resource extraction and export so as to allow the government to use natural resource revenues for investment elsewhere in the economy
Michael Ross’s 1999 article ““The Political Economy of the Resource Curse” reviews some of the potential problems that natural resource wealth brings to countries. According to Ross (1999), what happens when the “terms of trade” decline?
A. A decline in the terms of trade implies that resource-exporting countries will be able to purchase fewer imports for the same amount of resource exports.
B. A decline in the terms of trade implies that resource-scarce countries will be able to purchase fewer natural resource imports from abroad for the same amount of goods exported.
C. A decline in the terms of trade implies that the goods-producing sector in resource-rich countries will have a hard time exporting their products because they will become too expensive.
D. A decline in the terms of trade implies that the goods-producing sector in resource-rich countries will have an easier time exporting their products because they will become much cheaper.
A. A decline in the terms of trade implies that resource-exporting countries will be able to purchase fewer imports for the same amount of resource exports.
Ross (1999) is not satisfied with cognitive explanations for the political resource curse. Why?
A. Because they transgress the assumption of rationality preferred by social scientists
B. Because they are often ad hoc explanations rather than part of a theory
C. Because the evidence is lacking
D. All of the above
A. Because they transgress the assumption of rationality preferred by social scientists
