Why didn’t Texas suffer from the resource curse?


Despite being an economy powered by oil, they are a major tech hub and have a very strong and sophisticated economy.

Why? How did they do it, and is it through policies that can be emulated?

In: 1

Texas got chosen to be headquarters for NASA.

If they hadn’t, it’d be closer to Mississippi than not.

TL;DR – Texas diversified their economy over a hundred years ago, and has never put all their eggs in one basket.

A few different reasons, not the least of which is Texas is *huge* and encompasses a *lot* of different major cities with drastically different cultures. This results in Texas having quite the diversity of people, education, and industries. Sure, Texas has oil, but Texas always knew that oil was a finite resource and wouldn’t be there forever, so they needed to diversify their economy. Texas Instruments, a major international technology company, was founded in 1930, for example (and has a revenue stream of over $18 billion today). Texas also has a major tourism trade that has something for everybody, and contrary to the Texas stereotype several cities in the state have been pretty progressive when it comes to gay rights and LGBT in general (Austin, Dallas, and Corpus Christi being the big three). Texas is also home to 29 port cities that are critical gateways to global trade, lead all other states in agriculture, and manufactures everything from superconductors to airplanes. Their non-petroleum mining industry is huge, too, digging up everything from precious metals to lead and zinc, in addition to being the source of most of the nation’s cement, common clay, crushed stone, dimension stone, and gypsum.

Because Texas is still part of the US, still has big cities, and has the benefit of resource dividends allowing them to keep taxes lower (ie. no state income tax) that helps attract businesses and residents.

Texas isn’t a sovereign state.


The borders of Texas aren’t closed to other Americans. In the United States, people are free to move from one state to another.

So really the main policy to emulate is to have open borders that allow people to move to and from the place. People who want to work with oil can move to Texas from other parts of the US, and people who are from Texas but want to work elsewhere can move away.