Download Mining Enclave to Economic Catalyst

From Mining Enclave to Economic Catalyst
Mining Enclave to Economic Catalyst:
Large Mineral Projects in Developing Countries
Richard Auty
Professor Emeritus of Economic Geography
Lancaster University
The much-maligned multinational mining enclave is evolving the potential to become a
vital catalyst for welfare-enhancing reform of the distorted political economy of mineral-rich
developing countries.
Concerns about Large Mining Projects in Low-Income Countries
In recent years, multinational mining companies have faced mounting criticism
of their operations in developing countries. The criticisms are rooted in the perception of a political imbalance between large global corporations and weakened political
states, which confers dubious long-term economic benefits on host countries. More
specifically, large mineral investments are perceived to have an adverse impact on
sovereignty, government ethics, local communities, and macroeconomic performance in
the host countries. Critics of mining rallied around a recent internal review of World
Bank policy toward mine lending that argued both for tighter regulation of mining
companies’ activities in order to protect “the weak” and for the cessation of lending for
hydrocarbon projects due to their impact on global warming.1
This paper begins by evaluating these criticisms in the context of major shifts
in post-war policies in developing countries and the emerging evidence of a resource
curse. It argues that mining’s alleged adverse impact is in fact rooted in misguided postwar policies that led developing countries’ governments to overextend their economic
interventions. Despite perceptions to the contrary, the potential benefits from mining
Richard Auty is Emeritus Professor of Economic Geography at Lancaster University. He also taught at
Dartmouth College and was a visiting fellow at the Institute of Development Studies (Sussex), Harvard
Institute for International Development, Resources for the Future, and the Woodrow Wilson School,
Princeton. He has acted as a consultant for the World Bank, UNCTAD, HIID, National Bureau of Asian
Research and the U.S. Department of State. His research interests include mineral-driven development,
industrial policy and rent-driven models of the political economy of developing countries.
Copyright © 2006 by the Brown Journal of World Affairs
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Richard Auty
projects are substantial, although their capital-intensive nature does strongly skew their
economic contribution. The next section identifies ongoing pressures for corporate
policy to add the social sustainability of mineral projects as a third criterion for mineral
investment in developing countries, along with economic return and environmental
sustainability. The following section argues that current trends can transform multinational mineral companies into catalysts for much-needed welfare-enhancing reform of
the political economies of developing countries, many of which remain badly distorted
by past domestic policy errors. The final section summarizes the argument and briefly
notes potential obstacles to its successful implementation.
Renewed Concern about Multinational Mineral Enclaves
136
Mineral projects present different socioeconomic impacts (or linkages) on the host
economy compared to most agricultural, manufacturing, and service projects. This
is because mining projects operate with unusually strong economies of scale, which
dictate large investments that employ a small, skilled workforce over a finite period of
time, determined by the mineral reserves. As a result, the revenue flow from mining,
compared with most economic activity, is heavily skewed toward the return on capital
and the taxation of this return. The three other domestic linkages (local purchase of
mine inputs, further processing of the mineral, and expenditure by workers) are much
less significant: Mineral extraction requires specialized inputs, which are often most
efficiently imported from established mining regions in developed countries where their
production benefits from concentrated expertise. Similarly, downstream processing of
minerals is frequently market-oriented so that the higher value-added stages generated
by mining, such as metal fabrication, occur abroad. Furthermore, as a capital-intensive
activity, mining employs small numbers, so although workers are usually well-paid,
their domestic expenditure stimulates little economic activity.
The return on capital and its taxation therefore dominate the revenue from mineral
projects. The capital return largely accrues to foreign shareholders and banks, while
taxation of the profits usually flows to the host government. The domestic economic
impact of mining is therefore narrowly channeled and also acutely sensitive to the
manner in which the government deploys the tax revenue, which can make up a fifth
of GDP annually in the case of oil-exporting countries and some ore exporters.
This marked skew of mining linkages toward capital servicing and taxation has
four important consequences for the perceived and actual impacts of mineral projects. First, mining may appear to diminish the host nation’s sovereignty because of
companies’ historical response to heightened government intervention and perceived
investment risk. After the nationalizations of the 1960s and 1970s, when privatization
the brown journal of world affairs
From Mining Enclave to Economic Catalyst
programs and reformed mining codes drew international mineral companies to invest
in developing countries again, companies sought both high returns to compensate for
the perceived risk and tight safeguards against contract renegotiation. However, looking
beyond perception, Vernon’s obsolescing bargain identifies a radical shift that occurs
in the relative bargaining strength of corporations and governments over the course of
a mineral project, which places heavy risk upon the companies in the long-run.2 The
corporations are initially advantaged because they have technical information from
the mine feasibility studies and the ability to assemble finance, technology, skills, and
market access. Governments eager to attract inward investment may concede conditions that they, or their successors, subsequently regret. But after investing, companies
require five to ten years or more to recoup their large sunk capital and to earn the target rate of return, so their bargaining strength weakens vis-à-vis the host government.
This is especially so if unexpectedly high tax revenues from mineral exports reduce the
government’s need for further multinational investment or bank loans. Beyond their
aggressively hedging investment risk, companies create additional sovereignty concerns
where they provide their own physical security due to the extreme remoteness of mines
or government failure, as in Iryan Jaya and the Niger delta, respectively.
Second, mining’s characteristically skewed linkages lend to its portrayal as extracting a finite resource to benefit shareholders, downstream processing plants, and
consumers, all located overseas. For example, Girvan argued that the Jamaican bauxite
mines of the aluminum majors conferred a mere 4 percent of the total value added
along the aluminum production chain on the host country, and alumina refineries
barely conferred 16 percent.3 Such arguments provided the rationale for the wave of
mine nationalizations in the 1960s and 1970s and the formation of producer cartels
like the International Bauxite Association, which aimed to increase the share of the
value-added chain retained within host economies. The experiment with state ownership
was part of a broader fashion in development
The policies failed, partly because
economics during the first three post-war
decades to encourage increased state inter- proponents of increased state intervention in the economy. Intervention was vention overestimated the integrity of
meant to limit the adverse effects of global
commodity price volatility and to regulate developing countries’ governments.
malfunctioning domestic markets. The policies failed, partly because proponents of
increased state intervention overestimated the integrity of developing countries’ governments, which invariably used state firms (along with other forms of government
intervention) as sources of political patronage and personal revenue at the expense of
broad-based, long-term economic development.4 In addition, the use of production
controls and stabilization funds to manage commodity prices foundered in the face of
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Richard Auty
138
quota-breaking and unforeseen shifts in demand.5
Third, mineral projects dwarf and strongly influence the adjacent local economy
because of the size of the investments they make: a typical ore mine invests hundreds
of millions of dollars, and hydrocarbon extraction invests billions. If local governments
are politically weak and the central government is negligent, it is all too easy for local
communities to bear substantial environmental, economic, and social costs for which
they are inadequately remunerated. For example, mine construction assembles a large
and relatively well-paid workforce that creates transient local business opportunities; but
this workforce also bids up the price of local labor and housing and requires expanded
infrastructure, while creating social problems associated with an all-male migrant workforce, as well as major changes to the environment. The mine operating stage requires
a smaller, albeit more stable, workforce, and while companies give preference to locals,
the skills required may draw workers from other regions whose higher incomes may
be met with resentment among local non-mine workers. At the end of a project, mine
closure depresses the local economy. In a final blow to local communities, environmental
clean-up operations seldom restore land to its pre-mine condition.
Fourth, according to research into the disappointing performance of resource-rich
developing countries in recent decades, large revenue streams from natural resource
exports can adversely affect both government incentives and the trajectory of the
economy.6 Mining revenue has proved especially difficult to manage, most notably
with hydrocarbon extraction, because the revenue is often high relative to domestic
GDP and also volatile (with the notable exception of diamonds, where a cartel has
smoothed price trends). High revenues trigger political contests for their capture and
political pressure to rapidly channel revenue into the domestic economy, a temptation
many governments find difficult to resist.7 Redistribution of mineral revenue on a
per capita basis has not appealed to governments: they prefer indirect means, notably
over-expanding the bureaucracy and promoting inefficient “infant” industries, whose
protection against imports confers little incentive on the recipient factories to mature
and become globally competitive.
The fourth impact, the indirect allocation of mine revenue, has given rise to
two adverse consequences. First, the distribution of revenue feeds patronage and graft
that can corrode the quality of government. Mineral-driven economies, and especially
the oil-exporters, tend to exhibit unusually low quality of governance for countries at
their level of per capita income (Table 1). Second, the transfer of revenue from an efficient primary sector (mining) to subsidize the expansion of inefficient manufacturing
and bureaucracy reverses the competitive diversification of the economy required to
build economic resilience and sustain GDP growth. Instead, it increases reliance on
the primary sector and depresses the economy-wide efficiency of capital investment,
the brown journal of world affairs
From Mining Enclave to Economic Catalyst
causing GDP growth to decelerate. The economy becomes locked into a staple trap
of dependence in which a burgeoning subsidized sector increasingly relies on revenue
from one over-taxed, weakening commodity and is vulnerable to price shocks for that
commodity that can trigger a collapse in growth.
Many resource-rich countries experienced such growth collapses during the period
of unusually volatile commodity prices between 1974 and 1988 and under-performed
compared with resource-poor countries. Among the resource-rich countries, the mineral
economies found recovery particularly elusive prior to the transient windfall of the
mid-2000s commodity boom.8 After a growth collapse, recovery is protracted because
the preceding cumulative distortion of the political economy runs down all forms of
capital (produced, human, and social) and entrenches powerful vested interests that
oppose reform because they benefit from unreformed revenue distribution. Collapsed
economies also risk spiraling into civil strife as governments, now with less largesse to
distribute, resort to repression to maintain their power as rivals seek to take power by
force. For example, the oil-driven economies are strongly associated with autocratic
governments and abrupt regime change.9 Lootable commodities, like high-value minerals, alluvial diamonds, and coltan can fund local militias and perpetuate civil strife.10
It is therefore not surprising that the association of mineral projects with diminished sovereignty, large flows of revenue overseas, double-edged local impacts, and poor
economic performance has caused the benefits of mining investment in developing
countries to be questioned; the appropriate response, however, may not be to cease
investment. There are developing countries that have managed their mineral resources
well, including Botswana, Chile, Malaysia, and Indonesia, whose oil-driven development
achieved remarkable reductions in poverty during the period between 1967 and 1997.11
However, many resource-rich countries did experience growth collapses, after which
opposition from elites who have much to lose from change has stymied IMF-backed
reforms aimed at restructuring the distorted economies and reigniting sustainable GDP
growth. Within this context, recent changes in corporate investment criteria have the
potential to transform large mineral investments from economic enclaves into catalysts
for much-needed welfare-enhancing reform.
Pressures for Change in Mineral-Driven Development
Corporate policy has evolved in response to the checkered post-war experience of mining
investment in developing economies so that an initial concern with the rate of return
was broadened through the 1980s to include minimizing environmental damage, and,
subsequently, to embrace social sustainability.12 This expansion of investment criteria is
rooted in self-interest rather than altruism: the returns on large, sunk mining investments
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140
are threatened by both government failure to manage the mineral revenues effectively
and local opposition to mine activity. The large capital investment that strongly skews
mineral revenue toward profits and taxation now motivates corporations to generate
sustained welfare improvements in both the national economy and the local economy
to safeguard the large sums at risk.
Corporations can further reduce their risk by undertaking mineral projects as joint
ventures with other international mining firms and by deploying loan capital both from
commercial banks and from regional development banks like the African Development
Bank, Inter-American Development Bank, and European Bank for Reconstruction and
Development, along with the International Finance Corporation, a subsidiary of the
World Bank. The development banks facilitate high-risk investment projects because
even relatively small loans from them mean that governments that renege on mining
contracts jeopardize foreign aid as well as alternative sources of capital. However, development bank lenders in turn limit their own risk by making their loans conditional
on best environmental and social practice by mineral corporations, as monitored by
independent auditors. These banks are also seeking effective measures to strengthen
the social sustainability of projects.
Goldman Sachs has identified a substantial gap in best practice among oil corporations between the leading companies (BP, Shell, Statoil, and ExxonMobil) and
lagging companies, such as Lukoil and Petro-China, which are based in “emerging
markets.”13 The leading mining companies and development banks increasingly lobby
for improved transparency in public finances in mineral-driven economies. One response
is the Extractive Industries Transparency Initiative, a voluntary agreement whereby
corporate, government, and civil society representatives meet to scrutinize independent audits to ensure the sums the companies claim to have paid to the government
match the sums that the government claims to have received. A second measure to
limit maladroit deployment of mineral revenue is the establishment of mineral funds,
which perform useful functions in addition to tracking mineral revenue. Mineral funds
can also be used to match the rate of domestic absorption of revenue to the capacity
of the economy to use it effectively. This limits Dutch disease effects, whereby overly
rapid domestic expenditure triggers inflation and causes labor-intensive agriculture and
manufacturing, which face foreign competition, to become less viable than domestic
service activity. However, these recent checks upon politically expedient expenditure
of mineral fund revenues are weakened by the fact that recipient governments usually
retain considerable discretion over revenue dispersal or may cite unforeseen threats
(from neighboring states in the recent case of Chad) to renege on agreements once the
mineral revenue starts to flow.
Mineral companies are evolving a third response to deficient host country insti-
the brown journal of world affairs
From Mining Enclave to Economic Catalyst
tutions that draws upon the fact that the strict conditions negotiated for their large
investments create, in effect, early reform zones (ERZs). Basically, ERZs circumvent
the opposition of vested interests to top-down reform by providing “post-reform”
conditions of effective infrastructure and competitive incentives (not subsidies) as well
as enabling public services in specific sub-regions. As such, large mineral projects can
spearhead a dual track strategy to reform a distorted political economy. This emulates
the development strategies of successful developing countries, including resource-rich
Malaysia (by design) and Indonesia (by chance), and also China and Mauritius among
the resource-poor countries. The ERZ nurtures a dynamic market sector (track one)
along side the distorted sector (track two), which is reformed more slowly in recognition of the political risk to the survival of reforming governments if they tackle vested
interests head-on. The dynamic sector rapidly expands employment, foreign exchange,
and taxes, while also building a pro-reform political lobby to neutralize the vested interests. It achieves a size that can absorb workers and capital from the distorted sector,
which undergoes a relative decline. In this way, the dual track strategy allows gainers
from reform to compensate losers in inefficient industries, to provide a politically
practical means of managing opposition to reform.14 The next section explains more
specifically how large mineral projects can boost the dynamic market track within a
dual track strategy.
Large Mineral Enclaves as Catalysts for Economic Reform
The initial response of mining companies to pressure for increased social sustainability
was to allocate revenue, typically 0.6–0.8 percent of capital expenditure, to provide local
medical care, educational facilities, and other infrastructure that normally lies within
the remit of governments.15 This policy is open to criticism because local communities
are not always consulted about their requirements, facilities aresometimes built without
adequate provision for their maintenance, and governments can take advantage of these
facilities to evade their basic social responsibilities to local communities. Moreover, corporate social expenditure increases the dependence of the local economy on the mineral,
whose life is finite, rather than promoting self-sustaining welfare improvements.
The leading mineral companies have responded to these criticisms by drawing
upon their expertise to promote private business formation in areas both linked and
unrelated to the mine activity. This policy creates economic activity to expand the
dynamic market track and thereby expands economic growth, employment, and skills,
while building the tax base required to improve and maintain social services after
mineral extraction ceases.
Business formation is impeded in distorted developing economies not only by weak
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Richard Auty
financial systems and lack of skills but also by deficient institutions that undermine the
rule of law and facilitate rent seeking at all levels of government. Rent seeking allows
underpaid civil servants to abuse the authority of the state by either directly siphoning
The leading mineral companies have away public revenue or else skimming
it from businesses in ways that depress
responded to these criticisms by draw- incentives and deter long-term investing upon their expertise to promote ment in competitive activity. Under
private business formation in areas both these conditions, trading and real
estate, often reliant upon favors from
linked and unrelated to the mine activity. well-connected government and party
officials, hold fewer risks than investment in agriculture and manufacturing, which face
foreign competition. Small and medium enterprises (SMEs) seek to escape rent seeking
imposts by operating in the grey economy, which is estimated in some former Soviet
countries to range from one-quarter to two-thirds of official GDP.16
Rent seeking is an important reason why mining firms negotiate strict conditions
regarding their operating environment. For example, the terms negotiated by the Azeri
International Oil Corporation allow it to operate efficiently and achieve its targeted
17 percent risk-related rate of return, whereas firms without stringent safeguards fail,
even with rates of return that double this. A successful Azeri manufacturer estimates he
142
needs a 70 percent return to generate sufficient revenue and meet the targeted rate if
he were forced to cover illicit imposts. If correct, this suggests that outside the mineral
enclave, the absence of an enabling business environment depresses investment efficiency
to one-quarter of that within the enclave. This implies a massive welfare loss, as rent
seekers at the highest levels of government block economic reform.
Mining agreements in developing economies create an ERZ in which efficient
investment can thrive. These conditions can be extended to linked businesses such as
mine input suppliers, as well as to unlinked firms adjacent to the mine, to help diversify
the economy and sustain long-term welfare gains. The participation in the dual track
strategy by development banks, NGOs, and donor governments can strengthen the
capacity of local communities, and through them their local governments, to cooperate in the pursuit of legitimate local interests. These institutions can help SMEs to
acquire business and work skills, to access finance at competitive rates, and to match
international quality standards to supply a range of inputs to the mine, with subsequent
options to diversify both their product and geographical markets.
Micro-enterprises can also play a role, and one that is strongly poverty-alleviating,
where mining companies and NGOs nurture business start-ups like the cottage industry in Azeri refugee camps. There, wives stay home with their children, while earning
$80 per month for a 25-hour working week—four times a teacher’s salary—produc-
the brown journal of world affairs
From Mining Enclave to Economic Catalyst
ing industrial gloves (and other industrial clothing) to international standards. These
micro-businesses pay taxes and are beginning to stimulate their own domestic input
suppliers. They initially function as “stealth” enterprises below the radar of rent seekers
because they are so small, but their expansion may attract unwelcome attention that will
require assistance from the mineral firms with legal advice and other aid, as is already
the case with mine-linked SMEs. In this way, mineral companies can expand a dynamic
market sector to demonstrate the welfare benefits of efficient investment. This may even
eventually tempt rent seekers to invest in competitive economic activity as an insurance
policy against their own heavy dependence on capricious political favors.
Conclusions
Concern that multinational mining investments function as economic enclaves at the
expense of the sovereignty and economic well-being of developing countries is not new.
Such concern led to a wave of nationalizations during the 1960s and 1970s, but the
competitiveness of the new state mineral enterprises was eroded because political ends
overrode their commercial mandate. The nationalizations were part of fashionable postwar policies to extend the role of the state in economic management that distorted the
political economy and, during the period of heightened commodity price volatility of
1974–1988, resulted in growth collapses for many resource-rich developing countries.
The mineral-driven economies were among the worst affected because their commodity
revenues were unusually large relative to GDP and allowed their governments more leeway to distort the political economy over a longer period of time than the governments
of resource-poor countries like South Korea and Taiwan. The resource-rich countries
have struggled during the last two decades to reform their economies and recover from
the growth collapses in the face of the vested interests that exploit the distortions and
undermine economic reform.
In these circumstances, the contracts negotiated by international mining companies
to win shareholder backing for renewed large-scale investment in developing countries
can be turned to advantage for host nations. The mineral projects function, in effect, as
early reform zones that permit linked and adjacent economic activity to operate with
greater efficiency than is the case outside the mining enclave in the distorted economy.
Rapid growth of directly productive investment within the mineral region can help build
a dynamic market sector that eventually absorbs unproductive labor and capital from the
distorted sector and also provides that sector with a strong demonstration effect. In addition, it builds a political constituency for reform to take on the rent seeking interests.
This dual track reform strategy makes a virtue of the enclave character of mining that has,
hitherto, been portrayed by some as detrimental.
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Richard Auty
Mineral enclaves can therefore be an asset for long-term development if best practice
mining firms are not displaced by rivals from emerging markets that exhibit less concern
for broad-based social welfare. A second threat emerges if governments newly flush with
windfall revenues fail to recognize the potential long-term benefits from building a dynamic
competitive economy. Unfortunately, the 1960s and 1970s appear to have been decades
of solitude for the governments of countries like Venezuela and Bolivia, which appear
to have learned little. But mineral companies must also recognize that host governments
merit a share of the windfall profits from unexpected booms in the prices of their finite
natural resources, and they must strive to foster the welfare-enhancing expenditure of
such revenue. W
A
Notes
144
1. World Bank, Final Report of the Extractive Industries Review. (Washington, DC: World Bank,
2003).
2. Raymond Vernon, Sovereignty at Bay: The Multinational Spread of U.S. Enterprise (New York: Basic
Books, 1971).
3. Norman Girvan, Foreign Capital and Economic Underdevelopment in Jamaica, (Kingston, Jamaica:
Institute of Social and Economic Research, University of the West Indies, 1971).
4. Deepak Lal, The Poverty of “Development Economics” (Cambridge, MA: Harvard University Press,
1985).
5. Paul Cashin and C. John McCDermott, “The Long-Run Behavior of Commodity Prices: Small
Trends and Big Variability,” IMF Staff Papers 49, no. 2 (2002): 175–198.
6. Richard M. Auty, Resource Abundance and Economic Development (Oxford: Oxford University Press,
2001).
7. Richard M. Auty and A. H. Gelb, “Political Economy of Resource-abundant States,” in Resource Abundance and Economic Development, ed. R. M. Auty (Oxford: Oxford University Press, 2001), 126–144.
8. Auty, Resource Abundance and Economic Development.
9. Michael Lewin Ross, “Does Oil Hinder Democracy?” World Politics 53, no. 3 (2001): 325–361.
10. Ian Bannon and Paul Collier, Natural Resources and Violent Conflict: Options and Actions (Washington, DC: World Bank, 2003).
11. C. Peter Timmer, Operationalizing Pro-Poor Growth: Indonesia (Washington, DC: World Bank,
2004).
12. David Humphreys, “A Business Perspective on Community Relations in Mining,” Resources Policy 25
(2000): 127–132.
13. Goldman Sachs, Introducing the Goldman Sachs Energy Environmental and Social Index (London:
Goldman Sachs, 2005).
14. Shaomin Li, Shuhe Li, and Weiying Zhang, “The Road to Capitalism: Competition and Institutional
Change in China,” Journal of Comparative Economics 28 (2000): 269–292.
15. Goldman Sachs, Introducing the Goldman Sachs Energy Environmental and Social Index.
16. Simon Johnson, Daniel Kaufman, and Andrei Shleifer, “The Unofficial Economy in Transition,”
Brookings Papers on Economic Activity 2 (1997): 159–239.
the brown journal of world affairs
From Mining Enclave to Economic Catalyst
Country
PCGDP Voice +
Political Effective Regulation Rule of
Aggregate
($US PPP AccountGraft
stability Governance
burden
law
index
2004)
ability
Mali
1,030
0.35
0.07
-0.29
-0.26
-0.34
-0.52
-0.99
Nigeria
1,113
-0.65
-1.48
-1.02
-1.26
-1.44
-1.11
-6.96
Benin
1,127
0.3
-0.37
-0.39
-0.49
-0.47
-0.34
-1.76
Mozambique
1,233
-0.13
-0.15
-0.39
-0.29
-0.6
-0.79
-2.35
Angola
2,308
-1.02
-0.95
-1.14
-1.4
-1.33
-1.12
-6.96
Ghana
2,316
0.39
-0.1
-0.17
-0.28
-0.16
-0.17
-0.51
Azerbaijan
4,175
-0.97
-1.52
-0.81
-0.57
-0.85
-1.04
-5.76
Philippines
4,558
0.02
-1.01
-0.23
-0.06
-0.62
-0.55
-2.45
Peru
5,641
-0.04
-0.68
-0.58
0.17
-0.63
-0.35
-2.11
Venezuela
5,963
-0.46
-1.1
-0.96
-1.24
-1.1
-0.94
-5.8
Algeria
6,507
-0.91
-1.42
-0.46
-0.93
-0.73
-0.49
-4.94
Kazakhstan
7,494
-1.21
-0.11
-0.63
-0.89
-0.98
-1.1
-4.92
Botswana
9,267
0.73
0.7
0.83
0.96
0.73
0.86
4.81
Malaysia
9,760
-0.36
0.38
0.99
0.44
0.52
0.29
2.26
Chile
11,487
1.09
0.89
1.27
1.62
1.16
1.44
7.47
Trinidad & Tobago
11,910
0.49
0.04
0.47
0.61
0.17
0.02
1.8
Saudi Arabia
14,022
-1.63
-0.6
-0.06
-0.34
0.2
0.15
-2.27
South Korea
20,371
0.73
0.45
0.95
0.69
0.67
0.17
3.66
United Kingdom
30.843
1.37
0.77
1.85
1.62
1.71
2.06
9.38
Table 1 Institutional Quality 2004: Hydrocarbon Exporters (italics) and Comparator Countries
The index scores each range from 2.5 to -2.5 and are based on several surveys in each country.
Fall/Winter 2006 • volume xiii, issue 1
145
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