Simon Ville (University of Wollongong, Australia)
The notion that natural-resource oriented economies are feted to experience retarded or incomplete development has been around a long time, perhaps half a century. According to this perspective, the ‘windfall’ associated with resource abundance has brought in its wake cognitive, societal, policy, and economic restraints on development. In the mid 1990s, Sachs and Warner formalised this perspective into what is known as the ‘resource curse’ hypothesis. Recent work has provided something of a counterbalance by indicating that the curse is not inevitable and by investigating what resource-based economies can do to mitigate it. The debate is of much interest to policy-makers in supra-national organisations like the World Bank who are concerned at the belated development of many resource-based Latin American nations and a range of oil-dependent economies (De Ferranti et al 2002).
Some resource-based economies have avoided the curse altogether, and this includes those which have done so through a long period of economic development although little has been written about them within this context. Our focus is a comparative study of two such successful resource-based economies, Australia and Norway. They are appropriate nations for a comparative study, sharing a range of similarities in their economic structure and process of economic development. Both are small but wealthy economies, measured by GDP per capita (Maddison, 2001), that historically have clustered in natural resource and related service industries (primary production, mining, energy, shipping, and mercantile trade) as their principal sources of wealth and economic modernisation. Each nation has a tradition of small scale cooperative enterprise in many of these sectors, overseen by a positive role for the state, which is now giving way to large scale, corporate enterprise within a highly competitive framework. Both countries have traditionally drawn upon domestically generated new technology in their traditional clusters. While sharing many similarities in economic structure and historical development, significant institutional differences exist between the two nations, particularly in terms of educational and legal systems, migration patterns, colonial history, and geo-political location.
The comparative approach provides grounds for generalising about the conditions for successful development in resource-based economies. Economic development, by its nature, is a longitudinal process, and yet history has had little to say on this issue of contemporary interest, besides an assumption that truly successful nations will transit from natural resource to manufacturing industries. Australia and Norway have continued to rely heavily upon their resource-based industries. In this paper, we look at how these two economies have continually renewed and extended their resource base by drawing upon the role of learning and knowledge creation to facilitate innovation in these industries and spillovers into others sectors. In both nations we observe how the demands from the resources sector became dynamic factors in strengthening national knowledge bases in a number of critical areas, particularly in public research organisations, the capital goods sector, high tech industries, and business services. These knowledge bases, in turn, became a resource for further development across many sectors of the economy.
