Natural resource rent and inclusive finance: an institutional perspective

Xixi Li (), Jiajun Yang () and Ning Zeng ()
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Xixi Li: Macau University of Science and Technology
Jiajun Yang: Jilin University
Ning Zeng: Macau University of Science and Technology

Economic Change and Restructuring, 2024, vol. 57, issue 2, No 28, 29 pages

Abstract: Abstract Promoting inclusive finance is crucial for governments worldwide to drive inclusive economic growth and development. This study investigates the relationship between natural resource rent and inclusive finance, considering the role of institutional quality. Using a comprehensive dataset spanning 109 countries from 1996 to 2020, our research unveils novel insights in the field of inclusive finance. The findings from our fixed-effect regression and two-stage least squares regression analysis reveal that natural resource rent has a significant negative impact on inclusive finance, supporting the resource curse theory. Moreover, we observe that the effect of natural resource rent on inclusive finance is contingent upon the level of institutional quality. Specifically, in the presence of robust institutions, there is a positive association between natural resource rent and inclusive finance. However, in weaker institutional context, the relationship becomes negative. These findings withstand a series of robustness tests, underscoring their reliability. These findings also have significant policy implications for stakeholders and policymakers involved in promoting inclusive finance in resource-rich economies.

Keywords: Inclusive finance; Natural resource rent; Institutional perspective (search for similar items in EconPapers)
Date: 2024
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DOI: 10.1007/s10644-024-09593-1

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