Resource Abundance, Blessing or Curse : Comparative Analyses of Point and Diffuse Resources

The objective of this study is to assess the short and long run effects of renewable and non-renewable resource rents on economic growth in Cameroon. Taking crude oil rents and forest resource rents as proxies for non-renewable and renewable resources abundance respectively for the period 1977-2018, we used the autoregressive and dynamic autoregressive distributive lag (ARDL/DynARDL) modelling framework to achieve the stated objective. Results from the ARDL model indicate that, in the short run, both the renewable and non-renewable resources have a positive and significant effect on economic growth but the point resource is more significant than the diffused. A clear disparity in results is however noticed in the long run. While the point resources show that natural resources are a curse to long run growth, the diffuse resources reveal that natural resources are a blessing to long run growth. From the DynARDL simulation, a negative shock of the point resources leads to a fall in economic growth whereas diffuse resource indicates an increase. This shows that point resources are more prone to resources curse and diffuse resources to resources bless. The Cameroon government should ensure a proper allocation of natural resource revenues especially point resource rents, to growth inducing investment or social overhead capital such as open markets, transport infrastructures, and power sectors, so as to enhance growth and development