Major discoveries of oil and gas deposits have always been cause for celebration in developing countries, in anticipation of the potential financial windfall. But research has shown that countries with abundant revenues from natural resources often tend to have less economic growth and more social problems than do non-resource-rich countries. And in this podcast, World Bank economist James Cust says in many cases, economic growth begins to underperform long before the first drop of oil is ever produced. Cust and David Mihalyi of the Natural Resource Governance Institute, coauthored The Presource Curse, published in the December 2017 edition of the IMF’s Finance and Development magazine.
James Cust is an economist in the Office of the Chief Economist for Africa at the World Bank and an external research associate at the University of Oxford.