Diversified Development: Making the Most of Natural Resources in Eurasia (Europe and Central Asia Studies)

Indermit S. Gill, Ivailo Izvorski, Willem van Eeghen, Donato De Rosa

ISBN 10: 1464801193 / ISBN 13: 9781464801198

Published by World Bank Publications, US, 2014

About this Item

This report is about the twelve countries of the former Soviet Union (Eurasia). About 85 percent of the region's economic output is in six resource-rich economies. Today, 85 percent of Eurasia's 280 million people are no longer poor. But academics who study resource-based economies debate whether these countries are cursed or blessed. And Eurasia's policymakers long for the day when their economies are less extractive and more innovative. These observations prompt questions. Are resources a blessing or a curse? If it is one of these things, what would make it into the other? How much should Eurasia try to diversify their exports and economies away from natural resources? Are there ways to make Eurasian economies both extractive and innovative? The answers: a large majority of Eurasia's people should consider themselves blessed. To make sure that this blessing does not become a curse, Eurasian economies have to become efficient, more productive, job-creating, and stable. But efficiency is not the same as diversification: there is little evidence that more concentrated economies have slower productivity growth, fewer jobs, or much more economic volatility. Governments need to worry less about the composition of exports and production and more about asset portfolios-natural resources, built capital, and economic institutions. They have much to do. Eurasia's portfolios are heavy in tangibles like oil and gas and roads and railways and light in intangibles such as the institutions for managing resource earnings, providing social services, and regulating enterprise. But tangibles are not what distinguish success from failure-investments in intangibles, early in their development, have made some resource-rich countries both extractive and innovative.

Seller Inventory # LU-9781464801198

Bibliographic Details

• Title: Diversified Development: Making the Most of Natural Resources in Eurasia (Europe and Central Asia Studies)
• Publisher: World Bank Publications, US
• Publication Date: 2014
• Language: English
• ISBN 10: 1464801193
• ISBN 13: 9781464801198
• Binding: Paperback
• Condition: New
• Weight: 1160 grams

About this title

Synopsis

Development policy discussions in Eurasia often become debates about how economies can be made more diversified. For a region that is resource-rich, this is to be expected. But Eurasian economies have in many ways become less diversified during the past two decades. At the same time, people are much better off today than they were in the 1990s: poverty has been cut in half, incomes have increased fivefold, and education and health have improved noticeably since the tumultuous days following the collapse of communism. Eurasia’s economies have become more efficient: they are more integrated with the global economy and more productive at home. The region has also become better at converting natural wealth into productive capital; since the mid-2000s, it has built more in assets than the mineral wealth it has used up. But most countries in Eurasia have yet to learn the main lesson from the experience of resource-rich countries in other parts of the world. What distinguishes success from failure are the institutions to manage volatility, ensure high-quality education, and provide a competition regime that levels the playing field for enterprises. Development success comes from more diversified asset portfolios---a better balance between natural resources, capital, and institutions. This report, written by the Europe and Central Asia Region of the World Bank with the support of the Eurasian Development Bank, hopes to make the task of creating such portfolios a little easier.