Institutional Quality and Resource based Economic Sustainability: the Mediation Efects of Resource Governance
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Date
2022-01-20
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SN Business and Economic A Springer Nature Journal
Abstract
The discovery of extractive resources is associated with multiple opportunities and
unbridled optimism on achieving socio-economic development for many countries.
However, the question how the host governments meet expectations of indigenous
people by ensuring an ideal resource-based economic sustainability (RES) has been
receiving less research attention. Using the global panel dataset of 80 resourceendowed economies from 2010 to 2017, we postulate and empirically examine the
mediating efect of the resource governance (RESOGV) on the relationship between
institutional quality (IQ) and RES. The ANOVA and post hoc ANOVA results
revealed signifcant disparities in terms of IQ, RESOGV, and RES among countries with diferent levels of economic development, regions, and sector (mining or
petroleum). Moreover, the fixed effects (FE) and ordinary least square (OLS) results
confirmed that IQ marginally influenced RES. However, the influence was more
pronounced when it was partially (but complementary) mediated by the RESOGV.
The paper, therefore, stresses the importance of host governments in improving the
quality of their institutions. This will ultimately help enhancing their RESOGV
capabilities for attaining economic, social and environmental sustainability.
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Keywords
Resource-based economic sustainability · Resource governance · Institutional quality · Extractive resources · Economic regions