Hostname: page-component-78c5997874-m6dg7 Total loading time: 0 Render date: 2024-11-20T00:45:00.222Z Has data issue: false hasContentIssue false
  • English
  • Français

Could resource rents finance universal access to infrastructure? A first exploration of needs and rents

Published online by Cambridge University Press:  24 June 2016

Sabine Fuss ,
Claudine Chen ,
Michael Jakob ,
Annika Marxen ,
Narasimha D. Rao  and
Ottmar Edenhofer
Sabine Fuss
Affiliation:
Mercator Research Institute on Global Commons and Climate Change, Torgauer Strasse 12–15, 10829 Berlin, Germany. E-mail: [email protected]
Claudine Chen
Affiliation:
Mercator Research Institute on Global Commons and Climate Change, Germany
Michael Jakob
Affiliation:
Mercator Research Institute on Global Commons and Climate Change; Potsdam Institute for Climate Change Impact Research, Germany
Annika Marxen
Affiliation:
Mercator Research Institute on Global Commons and Climate Change; Technical University Berlin, Germany
Narasimha D. Rao
Affiliation:
International Institute for Applied Systems Analysis, Austria
Ottmar Edenhofer
Affiliation:
Mercator Research Institute on Global Commons and Climate Change; Technische Universität Berlin; Potsdam Institute for Climate Change Impact Research, Germany
Get access Rights & Permissions [Opens in a new window]

Abstract

It is often argued that, ethically, resource rents should accrue to all citizens. Yet, in reality, the rents from exploiting national resources are often concentrated in the hands of a few. If resource rents were to be taxed, on the other hand, substantial amounts of public money could be raised and used to cover the population's infrastructure needs, such as access to electricity, water, sanitation, communication technology and roads, which all play important roles in a nation's economic development process. Here, the authors examine to what extent existing resource rents could be used to provide universal access to these infrastructures.

Type
Research Article
Information
Environment and Development Economics , Volume 21 , Issue 6 , December 2016 , pp. 691 - 712
Copyright
Copyright © Cambridge University Press 2016 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Aker, J.C. and Mbiti, I.M. (2010), ‘Mobile phones and economic development in Africa’, Working Paper No. 211, Center for Global Development, [Available at] http://www.cgdev.org/content/publications/detail/1424175/.Google Scholar
Arnott, R.J. and Stiglitz, J.E. (1979), ‘Aggregate land rents, expenditure on public goods, and optimal city size’, Quarterly Journal of Economics 93(4): 471–500.CrossRefGoogle Scholar
Arrow, K., Dasgupta, P., Goulder, L., G., et al. (2004), ‘Are we consuming too much?’, Journal of Economic Perspectives 18(3): 147–172.Google Scholar
Barma, N.H., Kaiser, K., Le, T.M., and Vinuela, L. (2012), Rents to Riches? The Political Economy of Natural Resource-Led Development, Washington, DC: World Bank, [Available at] http://ideas.repec.org/b/wbk/wbpubs/2381.html.Google Scholar
Calderón, C.A. and Servén, L. (2014), ‘The effects of infrastructure development on growth and income distribution’, Annals of Economics and Finance 15(2): 521–534.Google Scholar
Caselli, F. and Michaels, G. (2013), ‘Do oil windfalls improve living standards? Evidence from Brazil’, American Economic Journal: Applied Economics 5(1): 208–238.Google Scholar
Crousillat, E., Hamilton, R., and Antmann, P. (2010), ‘Addressing the electricity gap’, Background Paper for the World Bank Group Energy Sector Strategy, [Available at] http://siteresources.worldbank.org/EXTESC/Resources/Addressing_the_Electricity_Access_Gap.pdf.Google Scholar
Dhillon, A. and Perroni, C. (2001), ‘Tax earmarking and grass-roots accountability’, Economics Letters 72(1): 99–106.Google Scholar
Drèze, J. and Sen, A. (2013), An Uncertain Glory: India and Its Contradictions, Princeton, NJ: Princeton University Press.Google Scholar
Edenhofer, O., Mattauch, L., and Siegmeier, J. (2013), ‘Hypergeorgism: when is rent taxation as a remedy for insufficient capital accumulation socially optimal?’, CESifo Working Paper Series No. 4144, CESifo Group, Munich, [Available at] http://ideas.repec.org/p/ces/ceswps/_4144.html.CrossRefGoogle Scholar
Estache, A. (2010), ‘Infrastructure finance in developing countries: an overview’, EIB Papers 15(2): 60–88, [Available at] http://www.eib.org/attachments/efs/eibpapers/eibpapers_2010_v15_n02_en.pdf#page=62.Google Scholar
Estache, A. and Fay, M. (2007), ‘Current debates on infrastructure policy’, Policy Research Working Paper No. 4410, Washington, DC: World Bank, [Available at] http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.621.9592&rep=rep1&type=pdf.Google Scholar
Fay, M. (2001), ‘Financing the future: infrastructure needs in Latin America, 2000–05’, Policy Research Working Paper No. 2545, Washington, DC: World Bank, [Available at] http://ideas.repec.org/p/wbk/wbrwps/2545.html.Google Scholar
Fay, M. and Yepes, T. (2003), ‘Investing in infrastructure: what is needed from 2000 to 2010?’, Policy Research Working Paper No. 3102, Washington, DC: World Bank, [Available at] http://ideas.repec.org/p/wbk/wbrwps/3102.html.Google Scholar
Feldstein, M.S. (1977), ‘The surprising incidence of a tax on pure rent: a new answer to an old question’, Journal of Political Economy 85(2): 349–360.CrossRefGoogle Scholar
Gaffney, M. (2009), ‘The hidden taxable capacity of land: enough and to spare’, International Journal of Social Economics 36(4): 328–411.CrossRefGoogle Scholar
Garnaut, R. (2010), ‘Principles and practice of resource rent taxation’, Australian Economic Review 43(4): 347–356.Google Scholar
George, H. (1879), Progress and Poverty, Raleigh, NC: Lulu Press.Google Scholar
Hamilton, K. and Clemens, M. (1999), ‘Genuine savings rates in developing countries’, World Bank Economic Review 13(2): 333–356.Google Scholar
Hartwick, J.M. (1977), ‘Intergenerational equity and the investing of rents from exhaustible resources’, American Economic Review 67(5): 972–974.Google Scholar
Hughes, G., Chinowsky, P., and Strzepek, K. (2010), ‘The costs of adaptation to climate change for water infrastructure in OECD countries’, Utilities Policy 18(3): 142–153.Google Scholar
Hutton, G. (2012), ‘Global costs and benefits of drinking-water supply and sanitation interventions to reach the MDG target and universal coverage’, WHO/HSE/WSH/12.01, Geneva: World Health Organization, [Available at] http://www.who.int/water_sanitation_health/publications/2012/globalcosts.pdf.Google Scholar
IEA (2013), ‘Global land transport infrastructure requirements: estimating road and railway infrastructure capacity and costs to 2050’, Information Paper, Paris: International Energy Agency, [Available at] http://www.iea.org/publications/freepublications/publication/transportinfrastructureinsights_final_web.pdf.Google Scholar
IEA (2014), ‘World Energy Investment Outlook’, Special Report, Paris: International Energy Agency.Google Scholar
ITU (2014), World Telecommunication/ICT Indicators Database (18th edn), Geneva: ITU, [Available at] http://www.itu.int/en/ITU-D/Statistics/Pages/publications/wtid.aspx.Google Scholar
Jakob, M., Chen, C., Fuss, S., Marxen, A., Rao, N.D., and Edenhofer, O. (2016), ‘Carbon pricing revenues could close infrastructure access gaps’, World Development 84: 254–265.CrossRefGoogle Scholar
Kohli, H.A. and Basil, P. (2011), ‘Requirements for infrastructure investment in Latin America under alternate growth scenarios: 2011–2040’, Global Journal of Emerging Market Economies 3(1): 59–110.CrossRefGoogle Scholar
Land, B.C (2008), ‘Resource rent taxation – theory and experience’, Prepared for the IMF Conference on Taxing Natural Resources: New Challenges, New Perspectives, 25–27 September, [Available at] http://www.imf.org/external/np/seminars/eng/2008/taxnatural/pdf/land.pdf.Google Scholar
Lederman, D. and Maloney, W.F. (2008), ‘In search of the missing resource curse’, Policy Research Working Paper No. 4766, Washington, DC: World Bank, [Available at] http://ideas.repec.org/p/wbk/wbrwps/4766.html.CrossRefGoogle Scholar
Markandya, A., González-Eguino, M., and Escapa, M. (2013), ‘From shadow to green: linking environmental fiscal reforms and the informal economy’, Energy Economics 40(Suppl. 1): S108–S118.Google Scholar
Mattauch, L., Siegmeier, J., Edenhofer, O., and Creutzig, F. (2013), ‘Financing public capital through land rent taxation: a macroeconomic Henry George theorem’, Working Paper No. 4280, Munich: CESifo.CrossRefGoogle Scholar
Mintz, J. and Chen, D. (2012), ‘Capturing economic rents from resources through royalties and taxes’, University of Calgary SPP Research Paper 30(5).Google Scholar
Neumayer, E. (2010), Weak Versus Strong Sustainability (3rd edn), Cheltenham: Edward Elgar.CrossRefGoogle Scholar
Pachauri, S., van Ruijven, B.J., Nagai, Y., Riahi, K., van Vuuren, D.P., Brew-Hammond, A., and Nakicenovic, N. (2013), ‘Pathways to achieve universal household access to modern energy by 2030’, Environmental Research Letters 8(2): 024015.Google Scholar
Pogge, T.W. (2007), World Poverty and Human Rights (2nd edn), Oxford: John Wiley & Sons.Google Scholar
Ross, M. (2001), ‘Does oil hinder democracy?’, World Politics 53(3): 325–361.Google Scholar
Rothman, D.S., Irfan, M.T., Hughes, B.B., Margolese-Malin, E., and Moyer, J.D. (2014), Building Global Infrastructure, Patterns of Potential Human Progress series, Boulder, CO: Paradigm Publishers.Google Scholar
Sachs, J.D. and Warner, A.M. (1995), ‘Natural resource abundance and economic growth’, NBER Working Paper No. 5398, Cambridge, MA: National Bureau of Economic Research, [Available at] https://ideas.repec.org/p/nbr/nberwo/5398.html.CrossRefGoogle Scholar
Sala-i-Martin, X. and Subramanian, A. (2003), ‘Addressing the natural resource curse: an illustration from Nigeria’, NBER Working Paper No. 9804, Cambridge, MA: National Bureau of Economic Research, [Available at] http://ideas.repec.org/p/nbr/nberwo/9804.html.Google Scholar
Sclen, H. and Kallbekken, S. (2011), ‘A choice experiment on fuel taxation and earmarking in Norway’, Ecological Economics 70(11): 2181–2190.Google Scholar
Segal, P. (2010), ‘Resource rents, redistribution, and halving global poverty: the resource dividend’, World Development 39(4): 475–489.Google Scholar
Sen, A. (1992), Inequality Re-Examined, Oxford: Clarendon Press.Google Scholar
Sen, A. (1999), Development as Freedom, Oxford: Oxford University Press.Google Scholar
UN (2013), ‘World population prospects: the 2012 revision’, New York: United Nations, [Available at] http://esa.un.org/wpp/.Google Scholar
van der Ploeg, F. (2011), ‘Natural resources: curse or blessing?’, Journal of Economic Literature 49(2): 366–420.Google Scholar
van Ruijven, B.J., Schers, J., and van Vuuren, D.P. (2012), ‘Model-based scenarios for rural electrification in developing countries’, Energy 38(1): 386–397.CrossRefGoogle Scholar
Wick, K. and Bulte, E. (2009), ‘The curse of natural resources’, Annual Review of Resource Economics 1(1): 139–156.Google Scholar
World Bank (2011), The Changing Wealth of Nations, Washington, DC: World Bank, [Available at] http://siteresources.worldbank.org/ENVIRONMENT/Resources/ChangingWealthNations.pdf.Google Scholar
World Bank (2014), World Development Indicators, Washington, DC: World Bank, [Available at] http://databank.worldbank.org/data/views/variableselection/selectvariables.aspx?source=world-development-indicators.Google Scholar
Supplementary material: File

Fuss supplementary material S1

Appendix

Download Fuss supplementary material S1(File)
File 1.6 MB
Supplementary material: File

Fuss supplementary material S2

Appendix

Download Fuss supplementary material S2(File)
File 1.1 MB
Supplementary material: File

Fuss supplementary material S3

Appendix

Download Fuss supplementary material S3(File)
File 174.1 KB