Nexus between financial intermediaries and natural resource price volatility in China

Xinlong Jia () and Lili Yang ()
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Xinlong Jia: Shandong University
Lili Yang: Jiangsu University

Economic Change and Restructuring, 2023, vol. 56, issue 5, No 5, 2993-3014

Abstract: Abstract This study empirically investigates the impact of natural resource revenues on China’s financial sector’s indicators, financial intermediaries, economic and institutional quality indicator; China, a nation that is supposedly immune to the resource curse, is used as a case study in this research from the duration 2001 to 2020. In this investigation, Fourier ADF and FGL were used together with the structural break unit root test for cointegration as well. In order to assess the long-term link, a newly created bootstrapped ARDL was used. As a result of the newly suggested Fourier ARDL, BARDL’s resilience is further enhanced. It has also been calculated using Dynamic Ordinary Least Squares (DOLS). Single and cumulative Fourier frequency methods are used to study how parameters respond in a casual manner. In this paper, fresh and substantial empirical evidence is presented to demonstrate the financial services and natural resources curses. Although the research indicated a favorable correlation between natural resources and financial sector development, it also confirmed the financial position capacity sustenance theory. Administrative qualities and natural resources are intertwined, as are natural resources and financial development. When natural resource revenues are properly channeled via financial institutions and stock returns, they may stimulate economic development.

Keywords: Natural resources; Dynamic ordinary least square (DOLS); ARDL; China (search for similar items in EconPapers)
Date: 2023
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DOI: 10.1007/s10644-022-09397-1

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