From resource curse to green growth: Exploring the role of energy utilization and natural resource abundance in economic development

Muhammad Imran, Md Shabbir Alam, Zhang Jijian, Ilhan Ozturk, Salman Wahab and Mesut Doğan

Natural Resources Forum, 2025, vol. 49, issue 2, 2025-2047

Abstract: This study delves into the profound repercussions of the resource curse hypothesis within the Brazil, Russia, India, China, and South Africa (BRICS) nations from 1991 to 2022, examining the intricate interplay among natural resource abundance, energy consumption, and economic development (ED). Methodologically, it employs the cross‐sectionally augmented Dickey–Fuller test to assess stationarity and utilizes the Westerlund cointegration technique to analyze cointegration. Subsequently, the cross‐sectionally augmented autoregressive distributive lag model is deployed to explore the impact of natural resource availability, renewable and non‐renewable energy utilization, and carbon emissions on ED within these countries. The findings reveal a stark reality wherein both carbon emissions and non‐renewable energy consumption wield a consistently positive influence on short‐ and long‐term economic growth across the BRICS economies. Particularly striking is the dominant impact of non‐renewable energy consumption. However, this comes in stark contrast to the adverse effects identified with excessive resource and coal rents, signifying potential economic setbacks arising from rampant natural resource exploitation. Furthermore, the suboptimal utilization of renewable energy resources hints at a detrimental effect on ED. These results transcend the confines of developing nations, underscoring the universality of the resource curse hypothesis, affecting both developing and developed countries. The study illuminates the grave risks inherent in overreliance and overexploitation of natural resources, elucidating heightened competition that severely impedes the ED trajectory of the BRICS countries in both short and long terms. Policymakers must prioritize economic diversification, implement sustainable resource management, and invest in innovative technologies to mitigate the resource curse in BRICS nations, fostering resilience and sustainable economic growth. In conclusion, This study highlights the severe impact of the resource curse in BRICS nations, stressing the imperative for adept resource management to counter the risks linked with overdependence on non‐renewable resources and bolster sustainable economic growth.

Date: 2025
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https://doi.org/10.1111/1477-8947.12461

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Persistent link: https://EconPapers.repec.org/RePEc:wly:natres:v:49:y:2025:i:2:p:2025-2047

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