Revisiting resource curse hypothesis and sustainable development: Evaluating the role of financial risk for USA

Zhipeng Wang, Mei Zhang and Mohammed Moosa Ageli

Resources Policy, 2022, vol. 79, issue C

Abstract: Natural resources' involvement in fostering economic and financial activity is critical for economic development (ED) of a country. Current research employed time series data from 1990 to 2020 to examine total natural resource rents, domestic investment, financial risk index, patents by residents and non-residents, and their influence on ED in the United States. For unit root analysis, the study used an upgraded Dickey-Fuller technique and a Bayer-Hanck cointegration approach that works quite well with varying orders of integrated variables. In addition, the study employed dynamic ordinary least squares (DOLS) and completely modified ordinary least squares (FMOLS), which adjust for endogeneity and serial correlation. The findings reveal that overall natural resource rentals significantly boost the economy's ED. Domestic investment in gross fixed capital formation (GFCF) has substantially supported economic activity. At the same time, improvements in the FRI of the United States as a result of sustained ED indicate a beneficial influence on ED. Finally, the number of patents filed by residents and non-residents positively affects ED in the United States.

Keywords: Resource curse hypothesis; Sustainable development; Financial risk; USA (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jrpoli:v:79:y:2022:i:c:s0301420722004135

DOI: 10.1016/j.resourpol.2022.102970

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