scholarly journals Testing the Existence of Natural Resource Curse in Indonesia: The Role of Financial Development

2021 ◽  
Vol 22 (2) ◽  
pp. 213-227
Author(s):  
Sedwivia Ridena ◽  
Nurarifin Nurarifin ◽  
Wawan Hermawan ◽  
Ahmad Komarulzaman
Keyword(s):  
Natural Resources ◽  
Financial Development ◽  
Natural Resource ◽  
Generalized Method Of Moments ◽  
Resource Curse ◽  
Natural Resource Curse ◽  
Economic Output ◽  
Negative Effect ◽  
The Relationship

Natural resources may become a blessing that can contribute to societies’ welfare increases. Yet natural resource abundance could also become a curse for countries’ economic development. Numerous studies have investigated the relationship between natural resources and economic performance. However, the results remain ambiguous and have no consensus in the literature. In specific, most literature focused only on testing the curse’s existence, while studies that involve the role of financial development in mediating the nexus remain scarce. To the best of our knowledge, this is a pioneer study in a developing country endowed by natural resources. Using panel data of 33 provinces from 2012 to 2018, this study implements the Generalized Method of Moments (GMM) technique to examine the existence of the natural resource curse and scrutinize the role of financial development in mitigating the curse. Results show that Indonesia potentially experiences a natural resource curse. Nonetheless, the negative effect of natural resources on economic growth could be mitigated by enhancing the role of financial development to reach a certain threshold over economic output. This study recommends policymakers to not only increase financial development across the provinces but also pay more serious attention to other factors causing the natural resource curse in Indonesia.

scholarly journals Natural Resource Rent and Financial Development Nexuses in Bangladesh: The Role of Institutional Quality

2020 ◽  
Vol 4 (2) ◽  
pp. 108-114
Author(s):  
Muhammad Atif Khan ◽  
Kishwar Ali
Keyword(s):  
Natural Resources ◽  
Financial Development ◽  
Natural Resource ◽  
Institutional Quality ◽  
Financial Sector ◽  
Resource Rent ◽  
Natural Resource Rent ◽  
The Relationship

This paper examines the relationship between the development of the financial sector of the economy and natural rents. The financial sector of the economy is currently an important driver of economic growth. The study was conducted through the prism of addressing two key issues: determining the nature of the impact of natural rents on the financial development of Bangladesh; study of the role of the quality of institutional mechanisms in the relationship between natural rent and financial development of Bangladesh. The study period includes 35 years, from 1984 to 2019. The calculations were performed using an autoregressive model with a distributed lag, based on the order of integration and stationary properties of the variables of this study. The article presents the results of an empirical analysis, which showed a significant negative impact of the lease of natural resources on the financial development of Bangladesh. It is empirically confirmed that the quality of institutional mechanisms for the functioning of economic entities has a positive effect on the relationship between natural rents and the financial development of Bangladesh. The results of the study empirically confirm the hypothesis of insufficient natural resources in Bangladesh. The article emphasizes that the positive moderating role of the quality of the institutional base indicates that due to the strengthening of the institutional base, insufficient resources can become a benefit for the financial sector. The results of the study can be useful for representatives of the Government of Bangladesh from the standpoint of improving the quality of institutional infrastructure in order to ensure financial development, in which there will be positive effects from the implementation of natural resource lease processes. In the future, a study is planned to expand potential sources for the proper use of natural resource leases in Bangladesh. Keywords: natural resource rent, financial development, institutional quality, Pakistan.

scholarly journals Natural Resources and Civil Conflict: The Role of Military Expenditures

2021 ◽  
Vol 14 (12) ◽  
pp. 575
Author(s):  
Rabah Arezki ◽  
Markus Brueckner
Keyword(s):  
Natural Resources ◽  
Natural Resource ◽  
Resource Curse ◽  
Civil Conflict ◽  
Resource Rents ◽  
Important Message ◽  
Military Expenditures ◽  
Natural Resource Rents ◽  
The Relationship

Military expenditures significantly affect the relationship between the risk of civil conflict outbreak and natural resources. We show that a significant positive effect of natural resource rents on the risk of civil conflict outbreak is limited to countries with low military expenditures. In countries with high military expenditures, there is no significant effect of natural resource rents on civil conflict onset. An important message is thus that a conflict resource curse is absent in countries with sufficiently large military expenditures.

scholarly journals Natural Resource Rent and Finance: The Moderation Role of Institutions

2020 ◽  
Vol 12 (9) ◽  
pp. 3897 ◽  
Author(s):  
Muhammad Atif Khan ◽  
Muhammad Asif Khan ◽  
Kishwar Ali ◽  
József Popp ◽  
Judit Oláh
Keyword(s):  
Financial Development ◽  
Natural Resource ◽  
Resource Curse ◽  
Institutional Quality ◽  
Threshold Level ◽  
Quality Level ◽  
Resource Rent ◽  
Natural Resource Rent ◽  
The Relationship

This study empirically examines the nexuses between the natural resource rent and financial development in the context of the emerging economy of Pakistan, between 1984 and 2018, by subsuming the important role of institutional quality in this context under symmetric, asymmetric, and threshold settings. The literature to date provides no evidence on the asymmetric relationship between natural resource rent and financial development, and the moderation role of institutional quality in this connection. We show that natural resource rent negatively influences financial development, whereas institutional quality boosts financial development and positively moderates the relationship in the context of Pakistan. Also, we find a single significant threshold value of 3.097 above which the relationship of resource rent-finance turns nonlinear—as up to this threshold the coefficient is 3.228, which declines slightly to 2.804 above the threshold level. This implies that regulators should maintain at least an institutional quality level of up to 3.097 to experience the most desired financial benefits of the natural resource rent in Pakistan. Moreover, the results corroborate the existence of asymmetries in the relationship between the natural resource rent and financial development. This empirical evidence provides fresh insight for stakeholders regarding ambiguous natural resource rents and financial sector development nexuses and recommends that planning organs in Pakistan and other countries in a similar development cadre should use institutional quality as a tool to avoid the resource curse and view natural resources as a blessing rather than a curse.

FINANCIAL INCLUSION, INSTITUTIONAL QUALITY AND FINANCIAL DEVELOPMENT: EMPIRICAL EVIDENCE FROM OIC COUNTRIES

2021 ◽  
pp. 1-28
Author(s):  
MINHAJ ALI ◽  
MUHAMMAD IMRAN NAZIR ◽  
SHUJAHAT HAIDER HASHMI ◽  
WAJEEH ULLAH
Keyword(s):  
Financial Development ◽  
Method Of Moments ◽  
Positive Impact ◽  
Generalized Method Of Moments ◽  
Institutional Quality ◽  
Financial Inclusion ◽  
Moderation Effect ◽  
The Relationship ◽  
Unique Study

This unique study examines the moderation effect of institutional quality (IQ) on the relationship between financial inclusion (FI) and financial development (FD) of 45 Organization of Islamic Cooperation (OIC) countries. For empirical analysis, panel data are used for the period 2000–2016. We use the Arellano–Bond generalized method of moments (GMM) and two-stage least-squares (2SLS) method in our estimations to draw multidimensional results. The empirical results confirm the significant positive relationship between FI, IQ and FD. Interestingly, we find that IQ moderates FI and has a significant positive impact on FD. Our findings are robust to alternative econometric specifications of FI, IQ and FD. Therefore, policymakers must sensibly understand the pivotal role of FI and IQ in establishing sustainable future development of OIC countries.

scholarly journals The Potency of Eco-Innovation, Natural Resource and Financial Development on Ecological Footprint: A Quantile-ARDL Based Evidence from China

2021 ◽  
Author(s):  
Sahar Afshan ◽  
Tanzeela Yaqoob
Keyword(s):  
Natural Resources ◽  
Financial Development ◽  
Environmental Degradation ◽  
Natural Resource ◽  
Ecological Footprint ◽  
The Novel ◽  
Resource Rents ◽  
Long Run ◽  
Novel Method

Abstract Given the alarming deterioration of the environment, the present analysis investigates the role of eco-innovation, natural resources and financial development in influencing the environmental degradation of China. Applying the novel method of Quantile-ARDL, the current research is beneficial in portraying the dependence patterns of the variables with special emphasis on the nexus of eco-innovation and ecological footprint across numerous quantiles of the distribution which has not been examined so far in the literature. The empirical findings reveal that in the long run, eco-innovation reduces the level of ecological deterioration in China across all quantiles. On the other hand, the results suggest that the increase in credit to the private sector and natural resource rents augment environmental degradation. The outcomes imply that the over-dependence on natural resources and financial development can worsen the goals of sustainable development in China if the strategies of conservation and management are ignored. Moreover, witnessing the favourable role of eco-innovation, competent policies and regulations can be made towards sustainable efficient technologies and eco-friendly energy sources to halt global warming.

scholarly journals The role of country-level institutional factors in escaping the natural resource curse: Insights from Ghana

2019 ◽  
Vol 61 ◽  
pp. 433-440 ◽  
Author(s):  
Dawda Adams ◽  
Subhan Ullah ◽  
Pervaiz Akhtar ◽  
Kweku Adams ◽  
Samir Saidi
Keyword(s):  
Natural Resource ◽  
Resource Curse ◽  
Institutional Factors ◽  
Natural Resource Curse ◽  
Country Level

scholarly journals IS THE CURSE OF NATURAL RESOURCES OCCURING IN INDONESIA?

2018 ◽  
Vol 11 (1) ◽  
pp. 15-27
Author(s):  
Joko Tri Haryanto
Keyword(s):  
Natural Resources ◽  
Natural Resource ◽  
Central Government ◽  
Resource Curse ◽  
Quadrant Analysis ◽  
Natural Resource Curse ◽  
Mining Areas ◽  
East Kalimantan ◽  
Massive Number ◽  
Early Indication

Theories explain the occurrence of natural resource curse phenomenon as a the conditions in a country has an abundance of mining sector but unsustainable patterns of development. In case of Indonesia, several studies conducted to measure natural resource curse also occurs during decentralization era. Therefore, this research conducted by analyze the performance of APBD in mining areas. By using share analysis, the highest area is East Kalimantan Province, while the lowest is NTT Province. Meanwhile, from growth, the highest area is West Java and the lowest category is Banten Province. From the quadrant analysis, four areas are in the quadrant I, seven areas in quadrant II, six areas in quadrant III and most areas in quadrant IV. This massive number of mining areas in quadrant IV shall inflict a serious note for the Central Government, could be an early indication of the emergence of natural resource curse in Indonesia.  

scholarly journals KEPEMILIKAN SUMBER DAYA ALAM TERHADAP KONDISI SOSIAL EKONOMI WILAYAH DI INDONESIA

2015 ◽  
Vol 4 (1) ◽  
pp. 51
Author(s):  
Atri Putri A ◽  
Zul Azhar ◽  
Joan Marta
Keyword(s):  
Life Expectancy ◽  
Natural Resources ◽  
Natural Resource ◽  
Average Length ◽  
Resource Curse ◽  
Gdp Per Capita ◽  
Forward Region ◽  
Natural Resource Curse ◽  
Per Capita ◽  
The Difference

This study aims to determine the difference in life expectancy, the average, the difference in GDP per capita, and differences in poverty rates between developed regions rich natural resources and developed regions poor in natural resources. This study uses Typology Klassen in sampling, The results showed that there are significant differences in life expectancy in developed regions are rich in natural resources and advanced regions poor in natural resources. There are significant differences in the average length of school in the forward region rich in natural resources and advanced regions poor in natural resources. There are significant differences in GDP per capita between developed regions rich natural resources and developed regions poor in natural resources. There were no significant differences in the levels of poverty in the developed regions rich in natural resources with advanced regions poor in natural resourcesKeyword : natural resource curse, life expetancy, length of school, GDP, poverty

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