Ansari Dawud

This study analyses the economic developments in Yemen from the 1970s to today in the context of the resource curse hypothesis. After a brief survey of the resource curse literature, using empirical data, historical accounts, and political (economic) analyses, I confirm that post-reunification Yemen suffers from an intense oil curse. The curse is evidenced by low genuine savings rates, oil-dependency, a stagnating economy, and institutional failure. However, this study finds that the institutional failure which caused this is itself a product of the resource-curse- like developments following migrant worker remittances from Saudi Arabia in the 1970s and 1980s. Moreover, the current instability in Yemen has its origins in rent-seeking defections in the corrupt governing patronage

network due to sudden anticipations of oil exhaustion.