A resource rebellion : Avoiding a political resource curse during the gold rush

[Extract] In the last decade, political economy theorists have reinvigorated the resource curse thesis by supplementing the work of mainstream economists. This literature has become known as the political resource curse and has as its focus the often detrimental interplay of resources booms and political institutions. Victoria, which forged its democracy upon a gilded crucible, the gold rush, presents a unique puzzle for this literature. By re-examining Victoria’s early democratic advancements through the prism of the political resource curse, this article concludes that ideational as well as material causal mechanisms, when underpinned by energetic political and economic contention, can be crucial in alleviating the worst impulses of a political resource curse.

As the gold rush collided with a previous resource boom, pastoral land, a wave of gold-rush immigration sparked both economic and political contention. Such contention helped to alleviate the worst impulses embedded within a resource curse. Material causal mechanisms – in particular, the management and composition of alluvial gold – sparked economic contention, laying the foundation for emboldened immigrants to voice their demands. Chartism armed social forces with a coherent rhetoric that shaped the character of Victorian political contention; when a constituency has both the ability and the interest to demand better institutions, ideas can equip a citizenry with a cohesive framework to advance their political contention, helping to mitigate the institutional deterioration that can result from resource booms. The theoretical implications of this observation call for the political resource curse literature to better appreciate the interplay of ideas upon a resource curse.