The gold digger and the machine. Evidence on the distributive effect of the artisanal and industrial gold rushes in Burkina Faso

Résumé En

We use a quasi-natural experiment, the recent gold boom in Burkina Faso, to document the localwealth impact of private versus common property management. The net impact of privatizing themanagement of a natural resource on wealth is subject to theoretical debate. We measure householdwealth through consumption and consider two modes of property management: artisanal andindustrial mines. Artisanal mines are labor intensive and managed as a common property. Industrialmines are capital intensive and privatize the resource by enclosing their production area. We identifythe impact of each mode of gold extraction by exploiting two sources of variation: changes in thegold price and the geological setting of Burkina Faso. We show that a 1% increase in the gold priceincreases consumption by 0.2% for households neighboring artisanal mines, while we do not findany effect for households neighboring industrial mines. Thus, while the privatization and industrializationof production increases efficiency, in accordance with much of the literature on the commons,the distributive consequences of each mode of property management are such that artisanal minesbenefit more to the local communities.