The paper by Halvor Mehlum, Karl Moene, and Ragnar Torvik explores the relationship between natural resource abundance and economic growth, focusing on the role of institutional quality. They argue that while resource-rich countries can be both growth winners and losers, the key differentiator is the quality of institutions. When institutions are grabber-friendly (where rent-seeking is encouraged), more resources tend to lower income; when institutions are producer-friendly (where production and rent-seeking are complementary), more resources raise income. The authors test this hypothesis using Sachs and Warner's influential works on the resource curse, confirming that institutions play a decisive role. Their findings contrast with Sachs and Warner's claim that institutions do not significantly influence the resource curse. The paper also discusses various empirical tests and controls, including the impact of different types of resources and the role of other factors such as openness and investment. The results suggest that countries with good institutions can avoid the resource curse, even if they are resource-rich.The paper by Halvor Mehlum, Karl Moene, and Ragnar Torvik explores the relationship between natural resource abundance and economic growth, focusing on the role of institutional quality. They argue that while resource-rich countries can be both growth winners and losers, the key differentiator is the quality of institutions. When institutions are grabber-friendly (where rent-seeking is encouraged), more resources tend to lower income; when institutions are producer-friendly (where production and rent-seeking are complementary), more resources raise income. The authors test this hypothesis using Sachs and Warner's influential works on the resource curse, confirming that institutions play a decisive role. Their findings contrast with Sachs and Warner's claim that institutions do not significantly influence the resource curse. The paper also discusses various empirical tests and controls, including the impact of different types of resources and the role of other factors such as openness and investment. The results suggest that countries with good institutions can avoid the resource curse, even if they are resource-rich.