Norway’s economic success is unrivalled, both in Scandinavia as well as compared to other countries with oil resources.  In the early 20th century, Norway was relatively poor; they had limited agricultural lands and relied heavily on ocean resources and their merchant marine fleet to fuel their economy.  The hydroelectric resources were a part of their growth that put them back on par with their European neighbors.

The 1969 discovering of oil in the North Sea was the obvious answer to their economic growth.  The overlooked aspect is the low levels of corruption, sound public policy for future economic success, and democratic institutions that were already deeply entrenched in Norway.  Many oil-rich countries have squandered the wealth being incentivized for short-term spending at best, with politicians siphoning off the money at worse.  Timing can matter tremendously; Norway was developed first, THEN discovered oil in 1969.  That means that the already solid institutions were the ones to shepherd in their enormous success. 

TAGS: Norway.