Natural resources: a curse or a blessing ? Evidence from Burkina Faso’s gold boom

Mardi | 2016-11-08
16-17h20 en salle des thèses


This paper takes advantage of a quasi-natural experiment to provide the first comparative analysis of the impact of artisanal versus industrial extraction of natural resources on households’ wealth. This experiment is provided by Burkina Faso’s gold mining sector: gold represented 1.6% of the value of exports of the country in 2007, and 71% in 2011. We combine the geolocalization of – both artisanal and industrial – mining sites with annual variations in gold prices to identify the impact of mining according to the extraction technique being used. To measure household wealth, we rely on 4 household surveys recording consumption between 1998 and 2014. We show that despite the huge amount of wealth generated by industrial gold mines from the country’s perspective, the opening of these mines have not generated backward linkages at the local level sine they do not have any impact on households’ consumption. Artisanal mining in comparison significantly increases households’ consumption. Moreover, we acknowledge the existence of general equilibrium effects and show that the relationship between artisanal mining and consumption is unlikely to be driven by changes in local prices. These results complement the existing literature, which focuses on the expansion of existing industrial mines, by shedding light on the impact of opening industrial mines, and including artisanal mining in the picture.