Abstract
In this book, Jessica Steinberg introduces a solid and eloquent theory on the interactions between the state, mining companies, and the local population in mining communities in the African continent. The book argues that, in the presence of fixed natural resources, these three actors will interact strategically based on their perception and information of the current context. These interactions will define how (if at all) the local population is compensated for the mining activities and the position of the state as oppressor or enforcer, leading to different levels of governance.
By showing that the decisions of these actors directly affect each other’s activities and outcomes, Steinberg acknowledges the agency that the local communities have to improve their living standards and livelihoods, even in a context of limited state capacity. By doing this, the author approaches the question of “how do non-state actors shape local outcomes related to stability and distribution?” (p. 22). This is, I believe, the most significant contribution of the book.
Even if the book does not explore the feasibility of collective action among different community members, it uses various strategies to show that this collaboration is possible, and that it can shape the state and mining companies’ behaviour and ensure some degree of redistribution. Communities “have the potential to impose political costs on the state, and economic costs on the states and the extractive firms” (p. 31). Under certain conditions, local communities can ensure that mining actors hold on to the promises they made when first establishing in the community and that the state enforces these actions when the political costs of not doing it are significant.
Mines, Communities, and States introduces a novel view of the role of natural resources and its potential to promote the economic development of mining communities in Africa, showing avenues to avoid the natural resource curse, even when the state is not the one providing goods and services to the local population. By doing this, the book touches upon essential concepts in political economy, such as property rights and transaction costs, which are at the centre of many interactions in the natural resources sector but are not commonly addressed.
The book uses different approaches to communicate its two main findings: (1) that “actors’ beliefs about each other are central for constraining their behavior,” and (2) that transaction costs and externalities matter, as they shape these beliefs. In the first part, the book introduces the main actors and the interactions that take place among them. Then, Steinberg uses a game-theoretical approach to present these exchanges and the available potential outcomes. The model acknowledges that, in an asymmetric information environment, actors shape their beliefs based on past experiences or on what they immediately see in the local context. In this setting, the actors are rational agents trying to maximise their benefits, which often requires evading promises (for the case of the firms) or repression (in the case of the government). While I praised the model’s simplicity, I sometimes wanted to learn more about the parameters calibrating it and the probability of attaining different equilibria. Gladly, Steinberg introduces the model proofs in an appendix of the book.
The book will mostly attract readers interested in quantitative analyses yet believe in the importance of qualitative evidence. The second section of the book introduces two comparative cases. The first one contrasts the outcomes reached by two mining companies with operations in Mozambique. The second one presents the response of one mining company facing different contexts in Zambia and the Democratic Republic of Congo (DRC). This approach makes the book’s argument even more robust. It shows how firm behaviour is not universal but will adapt to the local context, which is conditional on the local community’s capacity to impose economic and political costs.
However, at the same time, I find that it is here where I could find one of the book’s potential shortcomings. In the argument, the government is weakly defined, considering it a sole entity and leaving aside all its layers, which are quite complex, particularly in the African context. Although this may facilitate the argument’s theoretical illustration, it leaves out a reality of confrontation and co-operation among various political actors, who also interact strategically.
The book’s quantitative section uses an econometric approach to support the argument and generalises the theory to other regions within the continent. This strategy seems robust, even if, again, distance to the countries’ capital is used to control for conflict. This variable does not consider that certain areas remain salient even when not proximate to a country’s capital, as it is the case of the former Katanga province in the DRC. Still, the results seem robust, and Steinberg uses different specifications to show the results’ economic and statistical significance and robustness.
Overall, Mines, Communities, and States is a fascinating book and a great example of how quantitative and qualitative research can work as complements. This benefits the final product, creating a more robust and sensible argument. The idea behind the book is simple yet powerful. Steinberg relies on her knowledge of the area and the extensive fieldwork she conducted. She combines this evidence with a quantitative approach that supports and generalises her argument. The extensive appendix shows her arduous methodological endeavour to formalise an intuitive theory and test the robustness of the results. This is a book that political economists and researchers interested in mining communities in Africa, as well as scholars interested in learning more about the agency of local communities, will definitely enjoy and benefit from, just as I did.