The Institutions Curse: The Theory and Evidence of Oil in Weak States

CIS Seminar Series

CIS welcomes Victor Menaldo, Assistant Professor of Political Science at University of Washington.
The discussant for this talk is Simon Radford, Political Science and International Relations PhD candidate, USC  ABSTRACT: Is there an institutions curse? Drawing on recent findings that challenge the view that there is a causal relationship running from oil to underdevelopment, I seek to identify what determines oil exploration and oil extraction rates in the first place. I argue and find that revenue starved states with low capacity are more likely to launch oil exploration efforts and goose the production of extant wells. These results hold after controlling for geological endowments, oil prices, and production costs. It does not matter how the dependent variable is specified; nor if state capacity is measured as a multidimensional index, a proxy for legal capability, deviations in foreign reserve holdings, or the state’s antiquity. The results hold across various fixed effects models, Autoregressive Distributed Lag models, estimated via Structure Generalized Method of Moments and instrumenting state capacity with relevant lags, or Two-Stage Least Squares that employ structural inequality as an instrument. To access draft of paper:http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2008889  BIO:   Victor Menaldo (Ph.D., Stanford University, 2009) is an assistant professor of Political Science at UW and an affiliated faculty of the Center for Statistics and the Social Sciences (CSSS). He specializes in comparative politics and political economy. Menaldo's research focuses on the political economy of taxation and redistribution, the political economy of regulation, the political economy of regime change, and the political economy of natural resources.  
He has published in the American Political Science Review, the Journal of Politics, the British Journal of Political Science, Comparative Political Studies, Comparative Politics, Economics & Politics, among other places. Menaldo's teaching interests include comparative political economy, political and economic development, the political economy of Latin America, and the politics of property rights.  For more info about Menaldo:http://www.polisci.washington.edu/directory/faculty/Faculty/faculty_menaldo.html
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