A Dual-Track Development Strategy for Saudi Arabia
Abstract
An economic irony that is gaining increasing attention is the “resource curse”
effect, whereby many of the poorest and most troubled states in the developing
world have paradoxically the highest levels of natural wealth.1 In fact, a growing
body of literature that suggests resource wealth itself, especially where it accounts
for the bulk of government revenues as in the case of the so-called “rentier states,”2
may harm a country’s prospects for development. National growth data bear this
out: rentier states with greater natural resource wealth tend to grow more slowly
than their resource-poor counterparts.