The role of natural resources in financial expansion:evidence from Central Asia

Central Asian States(CAS)have diverse natural resources.This research aims to shed light on the finance–natural resource’s association in the context of CAS namely Kazakhstan,Kyrgyzstan,Tajikistan,Turkmenistan,and Uzbekistan in 1996–2020 using the cross-sectionally augmented autoregressive distributed lag technique.It seeks to examine the research question,“What is the effect of natural resource wealth on the financial expansion(FE)of Central Asia?”The results demonstrated an inverted U-shaped association between financial growth and natural resource rents.It implies that natural resources are initially a“resource blessing”that later becomes a“resource curse.”Additionally,the effect of institutional quality(INQ)and human development(HD)on financial growth is examined.The results reveal that INQ and HD positively affect FE.Moreover,a bidirectional causal relationship exists between FE and INQ.Finally,all variables contribute to a long term FE.Based on these outcomes,the major policy recommendations are that the CAS authorities diversify their financial services and products and direct the proceeds from natural resource rents to effective invest-ments particularly in HD.In addition,the social and political infrastructures in CAS must be restructured to achieve a high-quality institutional environment,which is necessary to increase the role of the private sector.

Natural resource dependence, public education investment,and human capital accumulation

This paper examines the relationships between natural resource dependence, public education investment, and human capital accumulation. It addresses why the “blessing” of abundant natural resources often turns into a “curse” in many countries and regions, focusing on the crowding-out effect of natural resources on human capital. According to our empirical analysis of provincial panel data from China, natural resource dependence is significantly and negatively correlated with human capital accumulation. The crowding-out effect of natural resources on human capital exists only in the central and western regions of China. Our introduction of an interaction term for natural resource dependence and public education investment underscores the possibility of investing in public education to reduce the crowding-out effect of natural resource dependence on human capital. The government should utilize the income of the natural resource sector to increase investment in education to enhance local human capital.

Analysis of Venezuela's oil-oriented economy: from the perspective of entropy

To investigate the efficiency and stability of Venezuela＇s oil-oriented economy, this paper applied entropy to the analysis.Based on this method, Venezuela＇s oil-centered industry, inefficient regulatory system, and insensitive response to external changes are recognized as an increase in the country＇s entropy. According to these facts, a dissipative structure model is constructed to analyze the efficiency and stability of the Venezuela＇s economic system. The results show that financial assistants（fund flow）, policy reform（policy flow）, and advanced technology（technology flow） can perform as negative entropy inflows（NEIFs）. These NEIFs will promote a series of influence and feedback reactions, which will contribute to recovering Venezuela＇s system efficiency and stability.