PART 1
Property Rights and the Resource Curse
PART 2
Might Makes the Right to Sell?
PART 3
Stopping the Flow of Stolen Resources
PART 4
A Clean Hands Trust for the People of Sudan
ABSTRACT
The resource curse afflicts poor countries with valuable resources like oil and
diamonds. Such countries are prone to repressive governments, civil wars, and
slower growth. The article argues that the resource curse often results from a
failure to enforce property rights: the property rights of each country's
people in that country's natural resources. This right is widely affirmed in
international law, but violated when dictators and civil warriors sell off a
territory's resources in circumstances where the people could not possibly
authorize those sales. Firms that buy resources from repressive regimes are
therefore receiving stolen goods, and passing these stolen goods on to
consumers. Using a widely accepted metric, the article shows that at least one
in every eight barrels of oil currently entering the United States has been
stolen from its country of origin.
Previous proposals to address the resource curse have focused on trying to
convince kleptocratic regimes to behave better, or on creating novel
international institutions. This article describes two property rights
enforcement mechanisms that use existing national institutions to sanction
those who buy resources from the worst regimes. The first mechanism is
litigation in rich-country courts against the international corporations that
receive stolen resources. The second mechanism is an "anti-theft" trade policy
that enables rich countries to penalize states that buy resources from
disqualified regimes.
The article shows that authoritarianism, civil conflict, and slow growth in less
developed countries can result from a failure to enforce the property rights of
the poor. This flaw in global commerce can be corrected by ensuring that all
international resource sales respect the rules of legitimate trade.
