Natural Resources and Education: Evidence from Chile

Abstract

This paper empirically addresses the relationship between natural resource abundance and educational attainment. Using information for Chilean municipalities between 2000 and 2013, we exploit aggregate changes in natural resource exports and differences in local markets exposure to these changes to assess whether local specialization patterns may be related with educational outcomes. Our findings indicate that higher natural resource exports reduce educational attainment, in particular by discouraging young people from tertiary education. The effect is robust and quantitatively important. Our findings are consistent with the idea that natural resource abundance may have positive effects in the short-run, but may be detrimental for human capital accumulation.