ABSTRACT
An emerging body of literature argues that high dependence on the extraction of natural resources creates conditions that compel governments to increase the size of all extractive sectors. Some scholars call this phenomenon the extractive imperative. However, this research overlooks the effects that one sector, such as oil, can have on the development of institutions in other extractive sectors, such as mining or gas. This chapter explores interactions between the oil and metal mining sectors in Ecuador to answer the following question: Why did plans to develop the mining sector fail in the past decade and a half? What role does oil dependence play in the production of this outcome? The study focusses on the process of developing the capacity to promote, establish, and develop large-scale mining operations according to long-term plans, and with support from key actors. The empirical findings show that the adoption of policy instruments applied in the oil sector to pursue policy objectives in the mining sector produced some negative feedbacks on the latter. The research alerts scholars and practitioners of the need to scrutinize the negative feedbacks between extractive sectors when discussing the opportunities for economic diversification opened by different commodities.
