We Don’t Need No Education? Resource Curse on Human Capital in Kazakhstan

What is it about?

This paper shows that Kazakhstan’s wealth of natural resources, like oil and gas, is actually holding back the development of its people’s skills and education. The study focuses on the "resource curse," which is when countries with lots of resources face challenges in other areas, like education. Kazakhstan, with its rich resources but weak institutions, lack of transparency, and authoritarian government, is a good example of this problem. The research uses data from 2000 to 2019 across 14 regions and two major cities in Kazakhstan. It finds that areas more dependent on extracting natural resources, especially oil and gas, tend to invest much less in education. This highlights an important issue that is often overlooked when discussing resource-rich countries, particularly in Central Asia. These findings don’t suggest stopping mineral production, but they do urge policymakers to recognize the risks that come with relying too much on resources. The paper emphasizes the need for investing in education and building human capital, which is essential for long-term economic development. It also calls for better transparency and accountability in the extractive industry to create a more sustainable and diversified economy.

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