Economic prosperity, asymmetric natural resource income, and ecological demands in resource-reliant economies

Samson Adeniyi Aladejare

Resources Policy, 2023, vol. 82, issue C

Abstract: This study extends the literature by examining the linear and nonlinear effects of natural resource income and the contribution of environmental demands to long-term economic growth in resource-reliant economies (RREs). Data was sourced from 45 RREs from 1970 to 2019 and processed using three novel methodological techniques: the heterogeneous mean group (MG), augmented MG, and common correlated effects MG. Empirically, the study affirmed asymmetry in the natural resources rents-economic growth nexus. Specifically, the study found that environmental demands and positive changes to natural resources income are a blessing to long-term economic growth. In contrast, adverse changes to natural resources income are growth decelerating. Globalisation and human capital development served as control variables, and while the former accelerated long-term economic growth, the latter had an irrelevant effect on the RREs. In addition, the Dumitrescu and Hurlin causality result showed a bidirectional nexus between environmental quality and economic growth and between economic growth and negative natural resource income changes. A unidirectional causal flow from positive natural resources income to economic prosperity and from the latter to human capital development was also revealed. The study proposed relevant policy measures.

Keywords: Economic growth; Natural resources rents; Environmental quality; Resource curse; Resource-reliant economies; Symmetric and asymmetric analysis (search for similar items in EconPapers)
JEL-codes: N1 N5 O13 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0301420723001435
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:jrpoli:v:82:y:2023:i:c:s0301420723001435

DOI: 10.1016/j.resourpol.2023.103435

Access Statistics for this article

Resources Policy is currently edited by R. G. Eggert

More articles in Resources Policy from Elsevier
Bibliographic data for series maintained by Catherine Liu ().