The Impact of Abundance of Natural Resources and Human Capital on Financial Development of Iran (Auto Regression Distributed Lag Approach)

Considering that one of the most important concerns of the country's economic politicians is financial development and factors affecting it, and since Iran has a lot of educated manpower and is one of the rich countries in terms of having natural resources, such as is oil and gas; Therefore, this research seeks to investigate the effect of abundance of natural resources and human capital on financial development in Iran during the period of 1974-2021 using Auto Regression Distributed Lag (ARDL). The results indicate that the abundance of natural resources has a negative effect and human capital has a positive effect on financial development in the long term. Due to the fact that the incomes from natural resources enter the economic system from the institutional framework and government structure, it seems that in Iran, due to weak governance, the creation of rents, corruption, reduction of productivity and etc., it causes the opposite effect of natural resources on financial development. Also, the results of this research show that open trade and technology have a positive and significant effect on financial development in Iran's economy in the long term.