Deep Determinants of Corruption? A Subnational Analysis of Resource Curse Dynamics in American States

Published date01 March 2020
Date01 March 2020
Subject MatterArticles
Political Research Quarterly
2020, Vol. 73(1) 111 –125
© 2019 University of Utah
Article reuse guidelines:
DOI: 10.1177/1065912919878264
Does revenue from natural resource extraction increase
corruption? The substantial resource curse literature dem-
onstrates that this source of unearned government reve-
nue has harmful effects in certain institutional settings.1 If
two states, one with “strong” institutions and another
with “weak” institutions, experience resource windfalls,
we may expect deleterious outcomes only in the latter.
This understanding of resource curse dynamics suggests
that the international community encourage governments
that struggle with mineral wealth management to develop
institutional restraints and promote transparency, such as
Chile’s fiscal rules or Botswana’s commodity funds
(Hendrix and Noland 2014; Limi 2006). This advice is
supported by a well-developed literature.2 Yet, unsuc-
cessful reforms and backsliding remind us that even well-
intentioned governments can fail to curb corruption. Does
mineral wealth account for this observation?
We offer a complementary, but theoretically distinct,
explanation for the observed relationship between natural
resource–derived revenue and the misuse of public office
for private gain.3 Rather than promote a causal relation-
ship conditioned by institutions, we assert that state-
dependence characterizes the resource curse best. It is
well known that some individuals or groups that experi-
ence an event are more likely to experience it again, all
else equal (Heckman and Borjas 1980). However, there
are two possible explanations: unit-heterogeneity and
An analogy to addiction helps to elucidate our
approach. Some young adults who experiment with alco-
hol subsequently become alcoholics. A unit-heterogene-
ity explanation would assert that their fundamental
probability of alcohol dependency differs from others.
The consumption of alcohol does not alter this character-
istic. Such an understanding of alcoholism might lead one
to look for a genetic predisposition in the afflicted. A
state-dependent argument, by contrast, would suggest
that consuming alcohol in excess as a youth might mean-
ingfully alter the likelihood of consuming alcohol in
excess habitually.4
States are not individuals with genes, but comparative
political research suggests that this metaphor fits. With
respect to the determinants of corruption, unit-heteroge-
neity often points to differences in cultural attributes,
deep-seated social norms, or the nature of predominant
religious orientations to explain variation (Jong-Sung and
Khagram 2005; Paldam 2002). State-dependence instead
emphasizes the consequences of the initial choices made
878264PRQXXX10.1177/1065912919878264Political Research QuarterlyTyburski et al.
1Kansas State University, Manhattan, USA
2Tulane University, New Orleans, LA, USA
3University of Denver, CO, USA
Corresponding Author:
Patrick Egan, Tulane University, 316 Norman Mayer Building, New
Orleans, LA 70118, USA.
Deep Determinants of Corruption?
A Subnational Analysis of Resource
Curse Dynamics in American States
Michael Tyburski1, Patrick Egan2, and Aaron Schneider3
Drawing on comparative resource curse literature and American literature on the determinants of corruption,
we argue that the impact of natural resource extraction on corruption outcomes is state-dependent. That is, in
environments where corruption is already high, natural resource windfalls allow political actors and economic elites to
take advantage of state brokerage, further increasing corruption. However, in previously less-corrupt states, increased
natural resource extraction will not induce corruption. We rely on hierarchical linear models to interpret federal
corruption convictions data for the fifty American states between 1976 and 2012 and employ generalized method of
moments estimators to account for potential endogeneity. The findings are robust to alternative specifications and
have implications for the management of new resource extraction opportunities.
corruption, resource curse, state-dependence, subnational analysis

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