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Natural resources a curse or blessings for international trade? Empirical evidence from high indebted economies

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  • Yu, Xiuzhi
  • Jia, Fengshuo
  • Khan, Suliman
  • Khan, Zeeshan
  • Nassani, Abdelmohsen A.

Abstract

Literature on natural resources is available in abundunce; however, the link of international trade with natural resources in the previous literature is lacking. Therefore, this study scrutinized the nexus of natural resources and international trade in highly indebted poor economies from 1988 to 2021. Numerous time series approaches are employed in the study, which embraces ADF with break years for unit root testing, Bayer-Hanck for cointegration, FMOLS, DOLS, and CCR as primary method, while simple least square with break years taken is also considered another primary method in the study. The empirical estimates exhibit that NRR posits an asymmetric influence on international trade. Forest and oil rents improve international trade, while mineral rents have a resource curse. NG rents provide positive but insignificant outcomes. Moreover, economic growth substantially improves international trade in the long term. The simple least squares method provides similar results in breaking and non-breaking series of the variables. The robustness test follows a similar path and provide valid, robust, and reliable results compared to the primary estimates. Given the outcomes, the study provides relevant policy implications concerning international trade via the sustainable use of NRR through the actual role of economic expansion.

Suggested Citation

  • Yu, Xiuzhi & Jia, Fengshuo & Khan, Suliman & Khan, Zeeshan & Nassani, Abdelmohsen A., 2024. "Natural resources a curse or blessings for international trade? Empirical evidence from high indebted economies," Resources Policy, Elsevier, vol. 89(C).
    • Handle: RePEc:eee:jrpoli:v:89:y:2024:i:c:s030142072301320x
    DOI: 10.1016/j.resourpol.2023.104609
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