09 November 2010

Eventually equilibrate

In the long run the fact of the unsustainability of the Midas Touch says that the overall system will eventually equilibrate to one where the resource curse is not operating but that is only true if two conditions hold: 
  1. the system under the resource curse is not so global that the unsustainability of the sub-system makes the entire system collapse; and 
  2. the mechanism of the decision-making is such that the resource curse doesn't always dominate locally. 

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