عنوان مقاله [English]
Resources Curse or blessing? This is a problem that has been a significant contribution to theoretical discussions and applied studies in natural resource-rich countries for over half a century. In fact, it is important to know that can resources rents stimulate physical capital accumulation and whether financial development can lead to it? In this article we have investigated the effect of multi-dimensional and seven individual indices of financial development on how resources rents affect physical capital in Iran during 1970–2014, using ARDL Rolling model. The results show that with the increase of the multi-dimensional index and most of the individual indices of financial development, the effect of resources rents on physical capital accumulation has improved in both short- and long-run. In fact, financial development has increased the absorption capacity of these resources in the economy and reduced the vulnerability of the Iranian economy to fluctuations in natural resource sales. These results confirm the need to strengthen the financial system to transform natural capital to physical capital.