Mining and mistrust in government
JournalEuropean Economi Review
AuthorsAstghik Mavisakalyan, Anna Minasyan
PublishedMarch 2025
PublisherElsevier
Research ThemesBusiness and Industry
Natural resource extraction can undermine institutions through its negative impact on corruption and public goods provision, potentially affecting individual trust in local government.
We examine this conjecture by combining geo-referenced survey data with spatial data on mine locations across 28 post-communist countries of Central and Eastern Europe and the former Soviet Union.
Using information on the development status of mineral reserves, we employ a cross-sectional difference-in-differences approach comparing individuals living near active versus not-yet-active mines.
Our findings reveal a robust negative relationship between mining production and trust in local government.
Analysis of mechanisms indicates that corruption perceptions and practices primarily drive this relationship.
While examining alternative non-institutional channels, we find that environmental concerns may also contribute to government mistrust in specific contexts.
The Bankwest Curtin Economics Centre team acknowledges the Wadjuk Nyungar people as the traditional owners of the land on which the Centre is situated.