Monocausalism versus systems approach to development: The possibility of natural resource-based development

Development economics has over the years produced several one-factor explanations that we term as "fundamentalisms". The authors argue that these fundamentalisms are interdependent and complement each other, and hence, the process of economic development must be understood as systemic. The focus is on "production-structure fundamentalism" in the form of the resource curse. By use of empirical examples it is argued that resource-based development is possible by building institutions supporting development of new knowledge and competences. The paper concludes that rather than individual development factors, it is the by institutions sustained interdependency and interaction between different types of development factors that underlie development processes.