DO NATURAL RESOURCE RENTS MATTER FOR POLITICAL STABILITY?: AN EMPIRICAL EVIDENCE

Abstract

This paper empirically tries to examine whether total natural resource rents have effects on political stability across seven different regional groups by utilizing an unbalanced sample containing 158 countries for the period of 1990-2017 in the largest sense. These seven groups are the entire sample, developing countries, OECD countries, East Asian and Pacific countries, Latin American and Caribbean countries, Sub-Saharan countries, and African countries. We also included four more determinants of political stability in our models, which are GDP per capita, democracy, total population, and trade openness levels, in light of the studies in political stability literature. Our results show that an increase in the share of total natural resource rents leads to a decrease in political stability. In addition, this paper also determines that there are significantly positive effects of GDP per capita and democracy levels on political stability in all regions while total population level generally has a negative and statistically significant effect on political stability. Besides, as to the estimation results, trade openness positively and significantly affects political stability almost in all models.