IDEAS home Printed from https://ideas.repec.org/a/eee/jrpoli/v92y2024ics0301420724003088.html
   My bibliography  Save this article

Resource dependency and green growth paradigm: Exploring interstice mechanism using financial resource availability and FDI in EAP region

Author

Listed:
  • Zuo, Liang
  • Luo, Shunjun

Abstract

Natural resources can boost economic growth, support sustainability, and protect the environment. Revenues from resource exploitation can fund social programs, education, and healthcare. Intelligent management of financial resources can help balance resource use and sustainable growth, aiding in environmental preservation. In the same pursuits, this research investigates the role of domestic and international investment availability in mediating the relationship between natural resources and green growth. We analyzed the Central Asian and Pacific (EAP) regions from 1995 to 2022. This study employs a structural equation model to quantify natural resources' direct, indirect, and overall influence on green growth. It supports the resource curse hypothesis in the region. However, the mitigation of the resource curse in the region is observed through higher foreign direct investment (FDI), while the domestic financial resources exacerbate this phenomenon. FDI can mitigate the adverse consequences of Green Growth (GG) by generating employment opportunities and other sources of income. At the same time, insufficient controls and oversight in the administration of domestic financial resources contribute to the heightened influence of natural resources on GG. These factors result in the mishandling of funds, restricted investment in other sectors, and fluctuations in commodity prices.

Suggested Citation

  • Zuo, Liang & Luo, Shunjun, 2024. "Resource dependency and green growth paradigm: Exploring interstice mechanism using financial resource availability and FDI in EAP region," Resources Policy, Elsevier, vol. 92(C).
    • Handle: RePEc:eee:jrpoli:v:92:y:2024:i:c:s0301420724003088
    DOI: 10.1016/j.resourpol.2024.104941
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0301420724003088
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.resourpol.2024.104941?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.

    References listed on IDEAS

    as
    1. Mahmood, Nasir & Zhao, Yingjun & Lou, Qinqin & Geng, Jinzhou, 2022. "Role of environmental regulations and eco-innovation in energy structure transition for green growth: Evidence from OECD," Technological Forecasting and Social Change, Elsevier, vol. 183(C).
    2. Xu, Xiaoying, 2022. "The impact of natural resources on green growth: The role of green trade," Resources Policy, Elsevier, vol. 78(C).
    3. Zhang, Fan & Deng, Xiangzheng & Phillips, Fred & Fang, Chuanglin & Wang, Chao, 2020. "Impacts of industrial structure and technical progress on carbon emission intensity: Evidence from 281 cities in China," Technological Forecasting and Social Change, Elsevier, vol. 154(C).
    4. Wei Zhang & Siqi Zhao & Xiaoyu Wan & Yuan Yao, 2021. "Study on the effect of digital economy on high-quality economic development in China," PLOS ONE, Public Library of Science, vol. 16(9), pages 1-27, September.
    5. Huysman, Sofie & Sala, Serenella & Mancini, Lucia & Ardente, Fulvio & Alvarenga, Rodrigo A.F. & De Meester, Steven & Mathieux, Fabrice & Dewulf, Jo, 2015. "Toward a systematized framework for resource efficiency indicators," Resources, Conservation & Recycling, Elsevier, vol. 95(C), pages 68-76.
    6. Song, Malin & Xie, Qianjiao & Shen, Zhiyang, 2021. "Impact of green credit on high-efficiency utilization of energy in China considering environmental constraints," Energy Policy, Elsevier, vol. 153(C).
    7. Arin, K. Peren & Braunfels, Elias, 2018. "The resource curse revisited: A Bayesian model averaging approach," Energy Economics, Elsevier, vol. 70(C), pages 170-178.
    8. Zhao, Linhai & Chau, Ka Yin & Tran, Trung Kien & Sadiq, Muhammad & Xuyen, Nguyen Thi My & Phan, Thi Thu Hien, 2022. "Enhancing green economic recovery through green bonds financing and energy efficiency investments," Economic Analysis and Policy, Elsevier, vol. 76(C), pages 488-501.
    9. Shahbaz, Muhammad & Zakaria, Muhammad & Shahzad, Syed Jawad Hussain & Mahalik, Mantu Kumar, 2018. "The energy consumption and economic growth nexus in top ten energy-consuming countries: Fresh evidence from using the quantile-on-quantile approach," Energy Economics, Elsevier, vol. 71(C), pages 282-301.
    10. Michael E. Porter, 1991. "Towards a dynamic theory of strategy," Strategic Management Journal, Wiley Blackwell, vol. 12(S2), pages 95-117, December.
    11. Yuxiang, Karl & Chen, Zhongchang, 2011. "Financial development and environmental performance: evidence from China," Environment and Development Economics, Cambridge University Press, vol. 16(1), pages 93-111, February.
    12. R.M. Auty, 1993. "Determinants of state mining enterprise resilience in Latin America," Natural Resources Forum, Blackwell Publishing, vol. 17(1), pages 3-14, February.
    13. Miao, Chenglin & Fang, Debin & Sun, Liyan & Luo, Qiaoling, 2017. "Natural resources utilization efficiency under the influence of green technological innovation," Resources, Conservation & Recycling, Elsevier, vol. 126(C), pages 153-161.
    14. Rodolphe Desbordes & Shang‐Jin Wei, 2017. "Foreign Direct Investment and External Financing Conditions: Evidence from Normal and Crisis Times," Scandinavian Journal of Economics, Wiley Blackwell, vol. 119(4), pages 1129-1166, October.
    15. Qianyi Li & Md Qamruzzaman, 2023. "Innovation-Led Environmental Sustainability in Vietnam—Towards a Green Future," Sustainability, MDPI, vol. 15(16), pages 1-34, August.
    16. Li, Zongyun & Rizvi, Syed Kumail Abbas & Rubbaniy, Ghulame & Umar, Muhammad, 2021. "Understanding the dynamics of resource curse in G7 countries: The role of natural resource rents and the three facets of financial development," Resources Policy, Elsevier, vol. 73(C).
    17. Reilly, John M., 2012. "Green growth and the efficient use of natural resources," Energy Economics, Elsevier, vol. 34(S1), pages 85-93.
    18. Char-lee Moyle & Fabrizio Carmignani & Brent Moyle & Sajid Anwar, 2021. "Beyond Dutch Disease: Are there mediators of the mining–tourism nexus?," Tourism Economics, , vol. 27(4), pages 744-761, June.
    19. Agboola, Mary Oluwatoyin & Bekun, Festus Victor & Joshua, Udi, 2021. "Pathway to environmental sustainability: Nexus between economic growth, energy consumption, CO2 emission, oil rent and total natural resources rent in Saudi Arabia," Resources Policy, Elsevier, vol. 74(C).
    20. Jain, Pankaj K. & Kuvvet, Emre & Pagano, Michael S., 2017. "Corruption’s impact on foreign portfolio investment," International Business Review, Elsevier, vol. 26(1), pages 23-35.
    21. Ma, Qiang & Zhang, Mei & Ali, Sher & Kirikkaleli, Dervis & Khan, Zeeshan, 2021. "Natural resources commodity prices volatility and economic performance: Evidence from China pre and post COVID-19," Resources Policy, Elsevier, vol. 74(C).
    22. Khan, Zeeshan & Hossain, Mohammad Razib & Badeeb, Ramez Abubakr & Zhang, Changyong, 2023. "Aggregate and disaggregate impact of natural resources on economic performance: Role of green growth and human capital," Resources Policy, Elsevier, vol. 80(C).
    23. Jahanger, Atif & Usman, Muhammad & Murshed, Muntasir & Mahmood, Haider & Balsalobre-Lorente, Daniel, 2022. "The linkages between natural resources, human capital, globalization, economic growth, financial development, and ecological footprint: The moderating role of technological innovations," Resources Policy, Elsevier, vol. 76(C).
    24. Suoqin Jin & Christian F. Guerrero-Juarez & Lihua Zhang & Ivan Chang & Raul Ramos & Chen-Hsiang Kuan & Peggy Myung & Maksim V. Plikus & Qing Nie, 2021. "Inference and analysis of cell-cell communication using CellChat," Nature Communications, Nature, vol. 12(1), pages 1-20, December.
    25. Constantinos Alexiou & Sofoklis Vogiazas & Joseph G. Nellis, 2018. "Reassessing the relationship between the financial sector and economic growth: Dynamic panel evidence," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 23(2), pages 155-173, April.
    26. Usman, Muhammad & Balsalobre-Lorente, Daniel, 2022. "Environmental concern in the era of industrialization: Can financial development, renewable energy and natural resources alleviate some load?," Energy Policy, Elsevier, vol. 162(C).
    27. Xuan Xie & Ke Li & Zhiqiang Liu & Hongshan Ai, 2021. "Curse or blessing: how does natural resource dependence affect city‐level economic development in China?," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 65(2), pages 413-448, April.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Zhao, Linhai & Rasoulinezhad, Ehsan, 2023. "Role of natural resources utilization efficiency in achieving green economic recovery: Evidence from BRICS countries," Resources Policy, Elsevier, vol. 80(C).
    2. Sun, Yanpeng & Chang, Hsuling & Vasbieva, Dinara G. & Andlib, Zubaria, 2022. "Economic performance, investment in energy resources, foreign trade, and natural resources volatility nexus: Evidence from China's provincial data," Resources Policy, Elsevier, vol. 78(C).
    3. Jahanger, Atif & Hossain, Mohammad Razib & Usman, Muhammad & Chukwuma Onwe, Joshua, 2023. "Recent scenario and nexus between natural resource dependence, energy use and pollution cycles in BRICS region: Does the mediating role of human capital exist?," Resources Policy, Elsevier, vol. 81(C).
    4. Zhao, Xing & Guo, Yifan & Feng, Tianchu, 2023. "Towards green recovery: Natural resources utilization efficiency under the impact of environmental information disclosure," Resources Policy, Elsevier, vol. 83(C).
    5. Liu, Yang & Wang, Jianda & Dong, Kangyin & Taghizadeh-Hesary, Farhad, 2023. "How does natural resource abundance affect green total factor productivity in the era of green finance? Global evidence," Resources Policy, Elsevier, vol. 81(C).
    6. Hwang, Young Kyu & Sánchez Díez, Ángeles, 2024. "Renewable energy transition and green growth nexus in Latin America," Renewable and Sustainable Energy Reviews, Elsevier, vol. 198(C).
    7. Rafael Ninno Muniz & Carlos Tavares da Costa Júnior & William Gouvêa Buratto & Ademir Nied & Gabriel Villarrubia González, 2023. "The Sustainability Concept: A Review Focusing on Energy," Sustainability, MDPI, vol. 15(19), pages 1-22, September.
    8. Zeng, Chunying & Ma, Rong & Chen, Peilin, 2024. "Impact of mineral resource rents and fin-tech on green growth: Exploring the mediating role of environmental governance in developed economies," Resources Policy, Elsevier, vol. 89(C).
    9. Liu, Yishuang & Huang, Jinpeng & Xu, Jianxiang & Xiong, Shufei, 2024. "Natural resource dependence and sustainable development policy: Insights from city-level analysis," Resources Policy, Elsevier, vol. 91(C).
    10. Yang, Bin & Wu, Qiong & Sharif, Arshian & Uddin, Gazi Salah, 2023. "Non-linear impact of natural resources, green financing, and energy transition on sustainable environment: A way out for common prosperity in NORDIC countries," Resources Policy, Elsevier, vol. 83(C).
    11. Vincent Tawiah & Raymond Ayivor & Babajide Michael Oyewo, 2024. "Who cares about corruption in Africa? China or the USA?," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 29(3), pages 2647-2664, July.
    12. Zhang, Jianhua & Liu, Yushan & Zhang, Weihua & Ma, Xinyuan, 2023. "Role of green technologies in enhancing the efficiency of natural resources," Resources Policy, Elsevier, vol. 83(C).
    13. Zhang, Yanyan & chang, Hsuling & Saliba, Chafic & Hasnaoui, Amir, 2022. "Metallic natural resources commodity prices volatility in the pandemic: Evidence for silver, platinum, and palladium," Resources Policy, Elsevier, vol. 78(C).
    14. Cheng, Shixiong & Shu, Can & Jin, Meiling & He, Yuhang, 2023. "Balancing resources and sustainability: Analyzing the impact of mineral resources utilization on green growth," Resources Policy, Elsevier, vol. 86(PA).
    15. Lu, Huaixin & Liao, Xinlin & Wu, Youqun, 2024. "From resource curse to green renaissance: Analyzing the dynamics of natural resource abundance on China's green total factor productivity during business cycles," Resources Policy, Elsevier, vol. 89(C).
    16. Liang, Jinhao & Razzaq, Asif & Sharif, Arshian & Irfan, Muhammad, 2022. "Revisiting economic and non-economic indicators of natural resources: Analysis of developed economies," Resources Policy, Elsevier, vol. 77(C).
    17. Lin, Boqiang & Zhou, Yicheng, 2021. "How does vertical fiscal imbalance affect the upgrading of industrial structure? Empirical evidence from China," Technological Forecasting and Social Change, Elsevier, vol. 170(C).
    18. Muhammad Usman & Atif Jahanger & Magdalena Radulescu & Daniel Balsalobre-Lorente, 2022. "Do Nuclear Energy, Renewable Energy, and Environmental-Related Technologies Asymmetrically Reduce Ecological Footprint? Evidence from Pakistan," Energies, MDPI, vol. 15(9), pages 1-24, May.
    19. Zhu, Junpeng & Lin, Boqiang, 2022. "Resource dependence, market-oriented reform, and industrial transformation: Empirical evidence from Chinese cities," Resources Policy, Elsevier, vol. 78(C).
    20. Wang, Zhen & Hu, Difei & Sami, Fariha & Uktamov, Khusniddin Fakhriddinovich, 2023. "Revisiting China's natural resources-growth-emissions nexus: Education expenditures and renewable energy innovation," Resources Policy, Elsevier, vol. 85(PA).

    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:92:y:2024:i:c:s0301420724003088. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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.