The curse or blessing of natural resources: impact on entrepreneurship and gender dynamics in Sub-Saharan Africa

Abstract

The study examined the effect of natural resource abundance on entrepreneurship in Sub-Saharan Africa (SSA), with a particular focus on gender dynamics. Empirical analyses were conducted using econometric methods such as ordinary least squares; generalized moments, Driscoll and Kraay; and quantile regression for a panel of 47 African economies between 1990 and 2023. The results show that the abundance of natural resources has a positive effect on entrepreneurship for both men and women, although this effect is more pronounced for women. However, when natural resource is disaggregated into different type of resources, the impact become greater on male entrepreneurship than on female entrepreneurship. Furthermore, the results indicate an inverted U-shaped relationship between the abundance of natural resources and entrepreneurship. The study also highlights the crucial role of institutions in modulating the effect of natural resources on entrepreneurship and gender dynamic. Countries with better quality institutions, particularly those that fight corruption and ensure political stability; who put in place targeted policies to reduce inequalities in access to natural resources; who put in place programs to encourage female entrepreneurship in the natural resources sector; are better able to take advantage of natural resources to stimulate entrepreneurship. This study contributes to the stream of research that attempts to challenge the natural resource curse hypothesis by clarifying the conditions that enable African countries to evolve into more sustainable economies.