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Economic Growth and Natural Resources in Latin America: an application of the Stiglitz model

Abstract:

The development and the improvement of the use natural resources can greatly stimulate the economic development of a country. The aim of this article is to examine the effect of economic income on economic growth in nineteen Latin American countries. Based on Stiglitzs model (1974), who proposes a segmented by high income, high middle and low income. In order to abide the mentioned objective, we use an econometric panel data, taking economic and independent growth as the dependent variable for natural resources. The results show that economic growth is statistically significant in aggregate form, the same that varies when it incorporates certain variables of control and the stages of development reached by the countries of the region. Wherever, in high-income countries, natural resources have a negative and significant effect on output, while in middle-income countries, the effect is negative and statistically insignificant. Finally, we find in low-middle income countries, the ratio is the same than in the countries with middle and high income.