International Institutions and the Resource Curse

Many countries that are richly endowed with natural resources have failed to turn that resource wealth into sustained development. In many places, a small coterie of elites has become rich while most citizens see little benefit from their country’s vast resource wealth. A principal cause of this problem, often called the resource curse, is weak domestic institutions that permit leaders to enrich themselves and ignore the development needs of the country. From this, most scholars and policymakers have concluded that the way to fix the resource curse is to reform domestic institutions.

This article challenges the conventional wisdom and argues that international institutions can be harnessed to do the work of failed domestic institutions. The Article addresses the doctrinal and normative challenges that might arrive with this approach and concludes that international institutions, even if they are not the principal cause of the resource curse, can be useful tools to address it in developing countries.