Mining matters: natural resource extraction and local business constraints

By Ralph De Haas

Mining in the last two decades has boomed, but how has this affected economic activity? This paper looks at the local impact of mining activity on more than 20,000 firms in eight resource-rich countries. It contrasts the impact that activity can have on businesses in the immediate vicinity of a mine with the more positive effects on firms that are further afield. It also draws a distinction between the effects on businesses from different sectors, seeing more downward pressure on companies in tradeable sectors such as manufacturing and a more benign influence on businesses in areas such as services.