IDEAS home Printed from https://ideas.repec.org/a/eee/jrpoli/v90y2024ics0301420724001120.html
   My bibliography  Save this article

Financial development and resource-curse hypothesis: Moderating role of internal and external conflict in the MENA region

Author

Listed:
  • Li, Kaixian
  • Wang, Dongyu
  • Xu, Tong
  • Zhang, Yuqi

Abstract

“Resource curse hypothesis” has been extensively pondered in extant literature. However, less attention has been given to political risks and financial development (FD) in the Middle East and North African countries (MENA). Hence, this current study explores the role of internal and external conflicts in realizing the impact of natural resources on FD (Resource Curse) based on the foundations of resource endowment theory from 1990 to 2021. We test whether the resource curse hypothesis is effective for MENA nations during internal and external conflicts. The outcomes of moments quantile regression (MMQR) show that this study negates the resource curse hypothesis (NRC) because NRR supports FD in MENA countries. Internal and external conflicts impede FD; however, external conflicts show a stronger magnitude. When countries face internal and external conflicts, the resource blessing hypothesis does not hold anymore; rather, it becomes a resource curse. The negative sign of interaction terms of the NRR and internal and external conflicts capture this notion. Lastly, technological innovation facilitates FD. These conclusions are indispensable for conflict resolution and financial policies across conflict-prone and resource curse nations.

Suggested Citation

  • Li, Kaixian & Wang, Dongyu & Xu, Tong & Zhang, Yuqi, 2024. "Financial development and resource-curse hypothesis: Moderating role of internal and external conflict in the MENA region," Resources Policy, Elsevier, vol. 90(C).
    • Handle: RePEc:eee:jrpoli:v:90:y:2024:i:c:s0301420724001120
    DOI: 10.1016/j.resourpol.2024.104745
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0301420724001120
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.resourpol.2024.104745?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jrpoli:v:90:y:2024:i:c:s0301420724001120. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/30467 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.