Abstract:
This thesis adds to the literature on local welfare effects of resource extraction industries. I investigate how political participation rates and resource curse effects are influenced by the opening and closing of mines in SSA. Based on past research I hypothesize that increased employment and income leads to higher participation rates as a result of more lenient individual resource constraints. However, many SSA countries have a history of poor institutional quality, and when they discover natural resources; most of them are hit by what is commonly referred to as the resource curse.
High levels of corruption, political intimidation and declining measures of free and fair elections are examples of this, and I also look into how these parameters are influenced by mining activity. By employing a difference in difference strategy on Afrobarometer survey data and GPS-coordinates on future, present and past mines in SSA, my results show that demonstration activity is positively influenced whilst there’s no clear effect on voting. The resource curse effect variables on the other hand, seem to be strongly negatively influenced by mining activity. When examining how the resource curse effects influence participation rates I find that they have a negative effect on voting and a positive effect on demonstration.
This result could also be driven by another third variable, such as inequality, which is again effected by mining activity and windfalls. The conclusion could consequently be that the variables related to the resource constraint theory are at best offset by resource curse effects. Any measures that have been taken to include the local population in the economic growth process spurred by resources have mostly failed. As a result, people are voicing their discontent in demonstrations rather than more traditional political channels such as voting, as this no longer has any real effect on political outcomes.