This note reviews the theory and evidence around possible problems with natural resource extraction and considers the possible role of natural resources in structural transformation and inclusive growth.
Stevan Lee
While neither natural resources nor most other export sectors are very employment-intensive, they can still drive inclusive growth, which may be rather similar throughout low-income country settings, by driving increases in output and demand, including demand for non-tradeables, which are rather more employment-intensive. Because of this, sustained growth episodes led by either manufactured exports or natural resources, or a mixture, may each be characterised by a large shift in employment from traditional agriculture to services.
