Wakandanomics

By The Economist online….

“THIS will require a quick lesson in global economics…bear with me,” says Erik Killmonger, the muscular villain in “Black Panther”, a long-running Marvel Comics series. In that saga and the recent film it inspired, Killmonger and the Black Panther vie for the throne of Wakanda, a fictional African kingdom little known to the outside world. A land of great wealth and technological sophistication, it lends itself to several quick lessons in economics. Bear with us.

The source of Wakanda’s riches is its “great mound” of vibranium, a versatile ore left behind by a meteor strike, which can absorb sound and motion. Like other deposits of natural treasure, Wakanda’s vibranium attracts some vicious intruders. But unlike some other resource-rich countries, Wakanda has never succumbed to outside foes.

That has helped it escape the “resource curse”, in which natural riches keep a country poor by crowding out manufacturing or ushering in predatory government. The curse is greatly feared. But Wakanda’s success in eluding it is not as fantastical as widely believed. Many resource-rich economies, including Botswana and Norway, have prospered without superheroic help. According to an article in 2015 by Brock Smith of Montana State University, the 17 countries that discovered big oil, gas or diamond deposits after 1950 achieved GDP per person 40% higher on average than if they had continued to evolve in line with their peers.

Belief in the resource curse may partly rest on a statistical illusion. Countries that use natural riches well tend to enjoy vibrant economies of which resources are a diminishing share. As their GDP grows, the size of their mining, drilling or logging sector relative to their GDP falls. They may then appear less “resource-rich” than stagnant economies that depend heavily on natural bounty. Though vibranium is woven into Wakanda’s flourishing economy, mining it is probably now a small part of GDP, especially as its near-inexhaustible supply has presumably driven down its price, giving it a smaller weight in the national accounts.

Wakanda’s stewardship of its natural resources is, however, unusual in another respect. The country not only mines vibranium but designs and builds a dazzling variety of downstream applications. They include a nano-tech panthersuit that absorbs blows and bullets, then echoes the energy back against its source. The suit is matched by sneakers that silence the king’s footsteps, replacing sandals that his sister mocks (“What are those?”). The applications extend to weaponry and transport, such as the royal talon fighter that zips from Wakanda to Oakland, California, and the vibranium rail above which high-tech chariots levitate.

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Category: Business and finance, Approved, Finance and economics, FINANCE

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