Left in the Dark? Oil and Rural Poverty

Do oil booms reduce rural poverty and inequality? To study this we measure rural poverty by counting people who live in darkness at night: combining high-resolution global satellite data on night-time lights and population from 2000 to 2013. We develop a measure that accurately identifies 74% of households as above or below the extreme poverty line when compared to over 600,000 household surveys. We find that both high oil prices and new discoveries increase illumination and GDP nationally. However, they also promote regional inequality because the increases are limited to towns and cities with no evidence that they benefit the rural poor.

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