Oil rents and non-oil economic growth in CIS oil exporters. The role of financial development
| dc.contributor.author | Fakhri J. Hasanov | |
| dc.contributor.author | Ruslan Allahverdi Aliyev | |
| dc.contributor.author | Dilvin Taşkın | |
| dc.contributor.author | Elchin Suleymanov | |
| dc.contributor.author | Taskin, Dilvin | |
| dc.contributor.author | Hasanov, Fakhri J. | |
| dc.contributor.author | Aliyev, Ruslan | |
| dc.contributor.author | Suleymanov, Elchin | |
| dc.date.accessioned | 2025-10-06T17:49:32Z | |
| dc.date.issued | 2023 | |
| dc.description.abstract | The role of financial development is vital in long-run economic growth. Due to the windfall revenues it might have extra relevance in natural resource-rich developing economies. This study explores whether financial development measured in the percentage share of the bank loans to the private sector in GDP can facilitate the impact of oil rents on the development of the non-oil sector in Commonwealth of Independent States oil exporters: Azerbaijan Kazakhstan and Russia in the long run. It develops a combined framework where financial development acts as both a threshold variable and an interaction term for the impact of oil rents on non-oil GDP. We find a threshold effect of oil rents for the non-oil sector in Azerbaijan and Kazakhstan. It shows that the same magnitude of oil rents can create more non-oil growth if financial development exceeds 9.6% and 15.5% in Azerbaijan and Kazakhstan respectively. For Russia neither threshold nor interaction effects were found – oil rents have a linearly positive impact on non-oil economic development. Moreover we find that institutional quality fosters non-oil development in Azerbaijan. It also positively affects non-oil development in Kazakhstan and Russia albeit statistically insignificant. In the design of policies authorities may wish to implement measures that would lead to the further development of the financial sector and institutional quality to make oil rents more beneficial for the development of the non-oil sector. © 2023 Elsevier B.V. All rights reserved. | |
| dc.description.sponsorship | Schumpeter (1934) is one of the earliest supporters of the supply-leading hypothesis that FD promotes economic growth as a determinant of growth. Financial intermediaries offer services that enhance technological innovation, serving as a growth engine. MacKinnon (1973) and Shaw (1973) point to the importance of financial system liberalization, which will lead to competition in the finance industry and boost economic growth. Many empirical papers empirically support the supply-leading hypothesis and recognize the capital accumulation role of FD that will steer more investment and economic growth. Lower FD is one of the biggest challenges for developing countries, as it may obstruct economic growth triggered by technology transfers (Menyah et al., 2014). The role of FD on economic growth is investigated in various contexts, and many papers note the long-run impact of finance on growth (Jedidia et al., 2014; Peia and Roszbach, 2015; Samargandi et al., 2014; Nguyen et al., 2019; Afonso and Blanco-Arana, 2022). For Sub-Saharan African countries, credit supply augments economic growth only in lower-income countries (An et al., 2021; Taiwo, 2021). The outcomes of the quantile regression of Tariq et al. (2020) reveal a U-shaped relationship between the FD index and economic growth, where FD refers to an index provided by the IMF that captures the access, depth, and efficiency of financial institutions and financial markets. Finance adversely impacts growth below a certain level of the FD index; however, this impact is reversed when the FD exceeds the threshold level. When the financial institutions' access, depth, and efficiency are low, this is reflected by decreasing economic growth. | |
| dc.description.sponsorship | Financial intermediaries offer services that enhance technological innovation; International Myeloma Foundation, IMF | |
| dc.identifier.doi | 10.1016/j.resourpol.2023.103523 | |
| dc.identifier.issn | 03014207 | |
| dc.identifier.issn | 0301-4207 | |
| dc.identifier.issn | 1873-7641 | |
| dc.identifier.scopus | 2-s2.0-85152472787 | |
| dc.identifier.uri | https://www.scopus.com/inward/record.uri?eid=2-s2.0-85152472787&doi=10.1016%2Fj.resourpol.2023.103523&partnerID=40&md5=726aeb51191769c5b9f7317238c01cf7 | |
| dc.identifier.uri | https://gcris.yasar.edu.tr/handle/123456789/8458 | |
| dc.identifier.uri | https://doi.org/10.1016/j.resourpol.2023.103523 | |
| dc.language.iso | English | |
| dc.publisher | Elsevier Ltd | |
| dc.relation.ispartof | Resources Policy | |
| dc.rights | info:eu-repo/semantics/openAccess | |
| dc.source | Resources Policy | |
| dc.subject | Economic Growth, Financial Development, Interaction Term Models, Natural Resources, Oil Rents, Threshold Regression Models, Economic And Social Effects, Economics, Finance, Regression Analysis, Azerbaijan, Economic Growths, Financial Development, Institutional Qualities, Interaction Term, Interaction Term Model, Kazakhstan, Oil Rent, Oil Sectors, Threshold Regression Models, Natural Resources, Economic Growth, Financial Market, Financial Services, Gross Domestic Product, Natural Resource, Regression Analysis, Russian Federation | |
| dc.subject | Economic and social effects, Economics, Finance, Regression analysis, Azerbaijan, Economic growths, Financial development, Institutional qualities, Interaction term, Interaction term model, Kazakhstan, Oil rent, Oil sectors, Threshold regression models, Natural resources, economic growth, financial market, financial services, Gross Domestic Product, natural resource, regression analysis, Russian Federation | |
| dc.subject | Natural Resources | |
| dc.subject | Oil Rents | |
| dc.subject | Economic Growth | |
| dc.subject | Financial Development | |
| dc.subject | Interaction Term Models | |
| dc.subject | Threshold Regression Models | |
| dc.title | Oil rents and non-oil economic growth in CIS oil exporters. The role of financial development | |
| dc.type | Article | |
| dspace.entity.type | Publication | |
| gdc.author.id | Suleymanov, Elchin/0000-0002-6075-2744 | |
| gdc.author.id | Taşkın, Dilvin/0000-0001-6139-8006 | |
| gdc.author.id | Hasanov, Fakhri/0000-0001-8923-197X | |
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| gdc.author.wosid | Aliyev, Ruslan/H-2865-2014 | |
| gdc.author.wosid | Suleymanov, Elchin/N-4266-2014 | |
| gdc.author.wosid | Taşkın, Dilvin/AAL-1206-2020 | |
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| gdc.description.department | ||
| gdc.description.departmenttemp | [Hasanov, Fakhri J.] King Abdullah Petr Studies & Res Ctr, Energy Macro & Microecon Dept, POB 88550, Riyadh 11672, Saudi Arabia; [Hasanov, Fakhri J.] George Washington Univ, Econ Dept, Res Program Forecasting, 2115 G St, NW, Washington, DC 20052 USA; [Hasanov, Fakhri J.] Inst Control Syst, Modeling Socio Econ Proc, 9 Bakhtiyar Vahabzadeh, Baku 1141, Azerbaijan; [Aliyev, Ruslan] ADA Univ, Sch Business, 61 Ahmadbay Agha Oglu, AZ-1008 Baku, Azerbaijan; [Taskin, Dilvin] Yasar Univ, Fac Business, Izmir, Turkiye; [Suleymanov, Elchin] Baku Engn Univ, Dept Finance, Hasan Aliyev 120, AZ-0101 Khirdalan, Azerbaijan | |
| gdc.description.publicationcategory | Makale - Uluslararası Hakemli Dergi - Kurum Öğretim Elemanı | |
| gdc.description.startpage | 103523 | |
| gdc.description.volume | 82 | |
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| gdc.virtual.author | Taşkin Yeşilova, Fatma Dilvin | |
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| person.identifier.scopus-author-id | Hasanov- Fakhri J. (55629514100), Aliyev- Ruslan Allahverdi (56995916500), Taşkın- Dilvin (57199073908), Suleymanov- Elchin (57170575000) | |
| project.funder.name | Schumpeter (1934) is one of the earliest supporters of the supply-leading hypothesis that FD promotes economic growth as a determinant of growth. Financial intermediaries offer services that enhance technological innovation serving as a growth engine. MacKinnon (1973) and Shaw (1973) point to the importance of financial system liberalization which will lead to competition in the finance industry and boost economic growth. Many empirical papers empirically support the supply-leading hypothesis and recognize the capital accumulation role of FD that will steer more investment and economic growth. Lower FD is one of the biggest challenges for developing countries as it may obstruct economic growth triggered by technology transfers (Menyah et al. 2014). The role of FD on economic growth is investigated in various contexts and many papers note the long-run impact of finance on growth (Jedidia et al. 2014, Peia and Roszbach 2015, Samargandi et al. 2014, Nguyen et al. 2019, Afonso and Blanco-Arana 2022). For Sub-Saharan African countries credit supply augments economic growth only in lower-income countries (An et al. 2021, Taiwo 2021). The outcomes of the quantile regression of Tariq et al. (2020) reveal a U-shaped relationship between the FD index and economic growth where FD refers to an index provided by the IMF that captures the access depth and efficiency of financial institutions and financial markets. Finance adversely impacts growth below a certain level of the FD index, however this impact is reversed when the FD exceeds the threshold level. When the financial institutions' access depth and efficiency are low this is reflected by decreasing economic growth. | |
| publicationvolume.volumeNumber | 82 | |
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