Oil Resources And Institutional Quality Impact On The Development Process: Cases Of Kuwait And Venezuela

Abstract

The Analysis of natural resources impact on economic growth and development is due to the beginning in specialization of many economies in the production of energy resources such as oil, gas and minerals. Empirical studies have not yet reached a common conclusion about this relationship. 40% of them found that natural resources have a negative impact on economic growth, 20% have a positive effect, and 40% have no significant results. In this study, we try to re-examine this relationship in Kuwait and Venezuela for the period 1990-2014, using the VECM model that explains the impact of oil resources and the institutional quality on the HDI in the long term. The results indicate that the government effectiveness index has a positive impact on the human development index in both Kuwait and Venezuela during the study period. This is justified by the fact that natural resources served an important aspect of development issues in the sample countries with varying percentages