TY - JOUR
T1 - Fading local effects
T2 - Boom and bust evidence from a Peruvian gold mine
AU - Orihuela, José Carlos
AU - Gamarra-Echenique, Victor
N1 - Publisher Copyright:
© 2019 Cambridge University Press.
PY - 2020/4/1
Y1 - 2020/4/1
N2 - The local effects of mining might simply come and go with mine production. In this paper we revisit Aragón and Rud's (2013) study of the Yanacocha mine, frequently cited to account for local economic effects and backward linkages, but we offer a more nuanced interpretation: First, effects fade with the mine exhaustion; and second, impacts are the result of consumption boom-and-bust dynamics. While we find it more conceptually accurate to reserve the concept of backward linkages for effects of a productive nature, our evidence reveals that unskilled services is the one sector that benefits, in contrast to manufactures and skilled services. We stress that impact evaluations of mines are contingent to time and place, and contend that exploring the extent to which multipliers generate spillovers is central. The short-run effects of a mine might in fact give little indication of how to tell or make a blessing from a curse.
AB - The local effects of mining might simply come and go with mine production. In this paper we revisit Aragón and Rud's (2013) study of the Yanacocha mine, frequently cited to account for local economic effects and backward linkages, but we offer a more nuanced interpretation: First, effects fade with the mine exhaustion; and second, impacts are the result of consumption boom-and-bust dynamics. While we find it more conceptually accurate to reserve the concept of backward linkages for effects of a productive nature, our evidence reveals that unskilled services is the one sector that benefits, in contrast to manufactures and skilled services. We stress that impact evaluations of mines are contingent to time and place, and contend that exploring the extent to which multipliers generate spillovers is central. The short-run effects of a mine might in fact give little indication of how to tell or make a blessing from a curse.
KW - demand shock
KW - fiscal windfall
KW - linkages
KW - local effects
KW - resource curse
UR - http://www.scopus.com/inward/record.url?scp=85074144950&partnerID=8YFLogxK
U2 - 10.1017/S1355770X19000330
DO - 10.1017/S1355770X19000330
M3 - Article
AN - SCOPUS:85074144950
SN - 1355-770X
VL - 25
SP - 182
EP - 203
JO - Environment and Development Economics
JF - Environment and Development Economics
IS - 2
ER -