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The ‘natural resource curse’ is a common issue in economic development for resource-rich countries and regions. The growth of an energy (resource) dependent economy is often unsustainable because of the volatility of energy (resource) prices, the cyclical employment growth in the energy (resource) sector, and the temporal nature of energy (resource) development. The boom-bust cycle of the energy (resource) industry often repels other industries, leaving resource-rich locations overly concentrated in one sector. The surging growth in the energy (resource) industry crowds out other economic activities such as small business or entrepreneurship due to increased land and labour costs, and at the same time reduces the incentives for further education and training of low-skilled employees. It also creates environmental issues, increases local inequality, and stresses local government finance.
A sustainable development strategy for an energy economy should a) ensure that the hidden costs of resource extraction are adequately compensated, b) leverage the additional wealth and economic activity into permanent advantages, c) levy severance or production taxes that capture resource rents, d) invest strategically in workforce development, e) strengthen the capacity of local governments to manage resource development, and f) increase the transparency of local government and governance institutions.
Professor Mark Partridge holds the C. William Swank Chair of Rural-Urban Policy at The Ohio State University, working in its Department of Agricultural, Environmental, and Development Economics. He has published over 125 peer-reviewed journal papers, and he has been described as the most influential author currently working in the field of regional science. He is co-author of The Geography of American Poverty: Is there a Role for Place-Based Policy? Much of his research continues to examine how economic shocks affect local communities and their regions, including regions that have a strong mining industry. Another theme is how policy can mitigate the negative impacts of income inequality and poverty on the economy and wellbeing. He is the Managing Editor of the Journal of Regional Science and Co-editor of the Springer Briefs in Regional Science.
This event is free and open to the public. It is a collaboration among the ANU Arndt-Corden Department of Economics, the Australia New Zealand Regional Science Association International (ANZRSAI) and the NATSEM-University of Canberra.
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