Financial Development and Sustainable Competitiveness in Arctic Region: A Dynamic Panel Data Analysis

Farzan Yahya; Ghulam Abbas; Muhammad Hussain; Muhammad Waqas

doi:10.35784/pe.2022.1.24

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Published: Jan 3, 2022

DOI: https://doi.org/10.35784/pe.2022.1.24

Issue Vol. 17 No. 1 (2022)

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DOI

https://doi.org/10.35784/pe.2022.1.24

Authors

Farzan Yahya

farzan.yahya@yahoo.com

Institute of Southern Punjab, Department of Business Administration, Multan, Pakistan, Pakistan

https://orcid.org/0000-0001-5666-1279

Ghulam Abbas

g_abbas@iba-suk.edu.pk

IBA Sukkur University, Department of Business Administration, Pakistan, Pakistan

Muhammad Hussain

hussain.hed@gmail.com

Institute of Southern Punjab, Department of Business Administration, Multan, Pakistan, Pakistan

Muhammad Waqas

mwaqas@mail.ustc.edu.cn

Department of Business Administration, Institute of Southern Punjab, Multan, Pakistan, Pakistan

https://orcid.org/0000-0003-4098-5994

Abstract

The present study investigates the effect of financial development on sustainable competitiveness and its components (natural capital, resource intensity, and social cohesion) in the Arctic region. We employ bank-based, stock-market based, and composite index to measure financial development. To deal with endogeneity bias, system GMM is utilized. The results show a positive and significant effect of financial development on sustainable competitiveness. The estimates also assert that financial development encourages resource efficiency and social cohesion in the region. In contrast, we find the negative effect of financial development on natural capital. This suggests that overexploitation of natural resources may provide short-term benefits to the local and regional communities but it may threaten the long-term sustainability of the Arctic. Thus, the financial sector should be guided to support financing and investing activities in alternative eco-friendly technologies and ventures for reducing excessive natural resource utilization.

Keywords:

sustainable competitiveness, financial development, social cohesion, resource intensity, natural capital

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Yahya, F., Abbas, G., Hussain, M., & Waqas, M. (2022). Financial Development and Sustainable Competitiveness in Arctic Region: A Dynamic Panel Data Analysis. Problemy Ekorozwoju, 17(1), 267–278. https://doi.org/10.35784/pe.2022.1.24

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Financial Development and Sustainable Competitiveness in Arctic Region: A Dynamic Panel Data Analysis

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