Financial Development in the Shadow of the Resource Curse: The Role of Political Stability and Fiscal Decentralization in the European Union Countries

Öz

This study investigates the impact of political stability and the natural resource curse on financial development in the ten European economies with the highest fiscal decentralization rates from 2002 to 2020. To analyze the short and long-term relationships, panel data methods were used. Panel VAR and VECM models were applied for panel causality analyses, and AMG and CCE estimators were used for cointegration. In the short run, only natural resource revenues significantly affect financial development. However, in the long run, a collective causality from per capita income, political stability, fiscal decentralization, and natural resource revenues to financial development is observed. Parameter estimates reveal that fiscal decentralization and political stability significantly influence financial development, though the effect varies across countries. In Austria and Latvia, fiscal decentralization appears to mitigate the natural resource curse’s effects, whereas in other countries, the negative impacts of institutional weakness and natural resource revenue volatility are evident. The study demonstrates a long-run interaction between fiscal decentralization, natural resource revenues, political stability, and financial development, with governance structure as the primary mediating variable. Empirical findings suggest that policies aimed at mitigating the negative effects of the natural resource curse should focus on strengthening institutional reforms alongside fiscal decentralization.

Anahtar Kelimeler

• Political stability
• Fiscal decentralization
• Resources curse
• Financial development

Kaynak Lanetinin Gölgesinde Finansal Gelişme: Avrupa Birliği Ülkelerinde Siyasal İstikrar ve Mali Merkezsizleşmenin Rolü

Öz

Bu çalışma, 2002-2020 yılları arasında en yüksek mali adem-i merkeziyet oranlarına sahip on Avrupa ekonomisinde siyasal istikrarın ve doğal kaynak lanetinin finansal gelişme üzerindeki etkisini araştırmaktadır. Değişkenler arasındaki kısa ve uzun dönemli ilişkileri analiz edebilmek amacıyla panel veri ekonometrisine dayalı ampirik yöntemler kullanılmıştır. Panel nedensellik analizleri için Panel VAR ve VECM modelleri uygulanmış, uzun dönemli eşbütünleşme ilişkilerini ve heterojenliği dikkate almak üzere AMG ve CCE tahmincilerine başvurulmuştur. Kısa vadede, finansal gelişmeyi yalnızca doğal kaynak gelirleri önemli ölçüde etkilemektedir. Ancak uzun vadede, kişi başına düşen gelir, siyasal istikrar, mali adem-i merkeziyetçilik ve doğal kaynak gelirlerinden finansal gelişmeye doğru bütünsel bir nedensellik gözlemlenmektedir. Parametre tahminleri, mali adem-i merkeziyetçilik ve siyasal istikrarın finansal gelişmeyi önemli ölçüde etkilediğini, ancak bu etkinin ülkeler arasında farklılık gösterdiğini ortaya koymaktadır. Avusturya ve Letonya'da mali adem-i merkeziyetçilik doğal kaynak lanetinin etkilerini hafifletiyor görünürken, diğer ülkelerde kurumsal zayıflığın ve doğal kaynak geliri oynaklığının olumsuz etkileri belirgindir. Çalışma, mali adem-i merkeziyetçilik, doğal kaynak gelirleri, siyasal istikrar ve finansal gelişme arasında uzun vadeli bir etkileşim olduğunu ve yönetişim yapısının bu etkileşimi sağlayan başlıca aracı değişken olduğunu göstermektedir. Ampirik bulgular, doğal kaynak lanetinin olumsuz etkilerini azaltmayı amaçlayan politikaların, mali adem-i merkeziyetçiliğin yanı sıra kurumsal reformları güçlendirmeye odaklanması gerektiğini göstermektedir.

Anahtar Kelimeler

• Siyasal istikrar
• Mali adem-i merkeziyetçilik
• Doğal kaynak laneti
• Finansal gelişme

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