The Impact of the Interaction of Abundance Natural Resources and Governance Institutional Index on Human Capital in OPEC Member Countries: GMM Panel Approach

According to the theory of endogenous economic growth, human capital is considered as the most important factor in economic growth. For this reason, many models have tried to identify the factors influencing on human capital and the impact of these factors explains.
In the meantime, some economists believe the abundance of natural resources has been exacerbated rent-seeking behaviors in the economy and through this causes the disorder in resource allocation, increasing social and economic inequality and reducing human capital in countries has abundant natural resources. Including of these deviations can be mentioned to weak management of governments in using these resources to expand the human capital market. According to the important role management of natural resource abundance (Interaction of abundance natural resources and governance institutional index) in human capital market, The purpose of this study is to investigate the impact of the interaction of abundance natural resources and governance institutional index on human capital in OPEC member countries during the period from 1996 to 2016 using the Generalized Method of Moments (GMM). Overall, the results of this study show that abundance of natural resources from the channel improve institutional governance index has positive and significant impact on human capital in OPEC member countries. In fact, the results shown that promotion and progress in each dimension of the institutional index of governance leads to positive changes through the abundance of natural resources on the improvement of human capital in the studied countries. In addition, research findings show GDP per capita and life expectancy has positive and significant impact on human capital in OPEC member countries. Also results show that income inequality has negative and pointless impact on human capital in the studied countries.