Revisiting natural resources rents and sustainable financial development: Evaluating the role of mineral and forest for global data

This study analyzes the impact of total natural resources rents, economic growth, mineral rents, and forest rents on global financial development. Using the extended period from 1990 to 2020, this study utilizes the novel Quantile-on-Quantile regression approach. The estimated results asserted that economic growth is favorable for global financial development. However, total natural resources, mineral rents, and forest rents exhibit asymmetric influence on global financial development. The influence is positive with a lower frequency but negative in most quantiles for the latter (natural resources) variables. The negative impact of natural resource rents substantiates the natural resource curse in global financial development. The Breitung-Candelon Spectral Granger causality test asserted that total natural resources rents cause global financial development in the long run. It validates the importance of total natural resources in attaining global financial development. Based on the empirical results, this study suggests policies to help global financial development. Specifically, enhanced economic growth and government intervention in regulating natural resources via utilizing financial resources.