Resources, Ethnicity, and Commitment: Central Government Policies Toward Mineral-Rich Ethnoregions

Abstract

Previous research has found that ethnic minorities concentrated in resource-rich regions are more likely to launch secessionist rebellions, providing one possible explanation for the “resource curse” in development. It is obvious why these minorities would demand more autonomy, particularly in tax powers, but central governments and regional minorities could bargain over tax autonomy as an alternative to war. We argue that such bargains are often unenforceable because of incentives that both sides have to renege. As evidence of this commitment problem, we find that developing-country governments are no more likely to offer autonomy to ethnic minorities concentrated in mineral-rich regions than to other ethnic minorities, no less likely to discriminate against them, and generally unlikely to offer significant tax autonomy.

Keywords: federalism, decentralization, conflict, civil war, discrimination, ethnicity, minerals, natural resources