Does transparency pay? Natural resources, financial development and the extractive industries transparency initiative (EITI)

Harouna Kinda () and Edouard Mien ()
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Harouna Kinda: CERDI - Centre d'Études et de Recherches sur le Développement International - IRD - Institut de Recherche pour le Développement - CNRS - Centre National de la Recherche Scientifique - UCA - Université Clermont Auvergne
Edouard Mien: FERDI - Fondation pour les Etudes et Recherches sur le Développement International

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Abstract: Natural resources are known to hinder financial development in countries with weak institutions. We hypothesize that the Extractive Industries Transparency Initiative, an international norm aimed at promoting transparency in natural resource management, can mitigate this effect. Using fixed effects and entropy balancing methods, we provide empirical support for this hypothesis in a panel of 71 resource-rich countries between 1995 and 2019. Our results are robust to the use of alternative specifications and alternative measures of financial development. Finally, we provide a discussion of the transmission channels through which the financial resource curse may occur.

Keywords: Financial development; Natural resouces; Resource curse; Transparency (search for similar items in EconPapers)
Date: 2024-07
Note: View the original document on HAL open archive server: https://uca.hal.science/hal-04517850v1
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Published in World Development, 2024, 179, pp.106603. ⟨10.1016/j.worlddev.2024.106603⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-04517850

DOI: 10.1016/j.worlddev.2024.106603

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