Are digitalization and human development discarding the resource curse in emerging economies?

Huijun Liang, Changkuan Shi, Nabila Abid and Yanliang Yu

Resources Policy, 2023, vol. 85, issue PB

Abstract: The resource curse challenges economic development, mainly for developing and emerging countries; however, digital transformation may intervene in this nexus. Therefore, this study analyses the influence of natural resources rent, human development, and digitalization on economic development of emerging seven nations, i.e., China, Brazil, India, Turkey, Russia, Mexico, and Indonesia from 1990 to 2021. It applies Cross-sectional Augmented Autoregressive Distributed Lag model to capture the slope heterogeneity and cross-sectional dependence issues in panel data. The long run rejects the preposition of the resource-curse hypothesis and confirms a positive and significant association between natural resource rent and economic growth. Moreover, digitalization and human development substantially derive long-term growth and strengthen the positive association between natural resources and economic growth. It implies that digital transformation and human development can avoid the resource curse. Similar outcomes are observed in the short-run; however, their marginal impact is relatively lower. Comparable results are also found using alternative estimators, offering relevant policy suggestions and future implications.

Keywords: Resource curse; Economic growth; Digitalization; Human development (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (11)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jrpoli:v:85:y:2023:i:pb:s030142072300555x

DOI: 10.1016/j.resourpol.2023.103844

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