Economics & Finance / Economic Theory / Development Economics
Your Town Just Struck Oil. Why You Won't Get Richer. (Brazil Study)
Do Natural Resources Hurt Training, Human Capital, or Development? Evidence from Brazil's Oil Boom
Imagine your hometown hits a multi-billion-dollar oil jackpot. New schools, new hospitals, everyone gets rich, right? Wrong. A groundbreaking study from the London School of Economics by Francesco Caselli and Guy Michaels tracked exactly where the money went in Brazil's oil-boom towns. The shocking answer? It almost completely vanished. The oil industry created zero local jobs. The government spent billions on paper, but the slums didn't shrink, teachers didn't appear, and hospitals actually closed. The only people who got richer were the corrupt politicians. This video breaks down the 'resource curse' at the local level, revealing how a windfall can become a curse, and why your spreadsheet might be lying to you.
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