Oil at work: natural resource effects on household well-being in Ghana

The extraction of natural resources can have social and economic impacts on residents in a locality. Existing micro-level studies examining natural resources impact, like oil, have focused on developed economies and examine the impact at the means. This paper examines the effect of oil extraction across the distribution of households' expenditure in Ghana. Using household-level data, we employ an unconditional quantile difference-in-differences strategy to show that oil extraction has a positive effect on low-expenditure or poor households but negative effects for high-expenditure or rich households. Additionally, there are heterogeneous effects across household expenditure share on food and non-food items, localities and gender. Results are broadly consistent with theoretical predictions from standard microeconomics models.