Natural resource volatility and financial development during Covid-19: Implications for economic recovery

Ching-Chi Hsu; Ka Yin Chau; FengSheng Chien

doi:10.1016/j.resourpol.2023.103343

Natural resource volatility and financial development during Covid-19: Implications for economic recovery

Resour Policy. 2023 Mar:81:103343. doi: 10.1016/j.resourpol.2023.103343. Epub 2023 Jan 27.

Authors

Ching-Chi Hsu¹, Ka Yin Chau², FengSheng Chien^{2

3}

Affiliations

¹ School of Finance and Accounting, Fuzhou University of International Studies and Trade, 350202, China.
² Faculty of Business City University of Macau, Macau, China.
³ School of Finance and Accounting, Fuzhou University of International Studies and Trade, China.

Abstract

Demand for natural resources is constant, while the prices of natural resources increase day-by-day, which has a significant impact on financial development and economic activity. Thus, the study intends to test the association of natural resource volatility and financial development, in order to recommend policies for economic recovery. The study acquires and analyses data for the N11 economies. The findings reveal that natural resource volatility is linked to global economic growth and governmental governance in pre-pandemic era as well as during pandemic. Results exposed that natural resource volatility has a large detrimental impact on global economic growth and plays a prominent part in economic recovery. The findings are robust and reveal that natural gas, oil, and the quality of public administration all contribute to N11 financial development. The study suggests that policymakers address the challenges raised through the solutions discussed.

Keywords: Covid-19; Economic recovery; Financial development; Natural resource volatility; Public administration.