From resource curse to financial opportunity: A quantile-based frontier analysis of resources conversion efficiency in Southeast Asia

Southeast Asian economies are richly endowed with natural resources, yet the link between resource abundance and financial development remains complex and contested. This study explores the heterogeneous impact of different types of natural resource rents on financial development across five Southeast Asian countries, Indonesia, Malaysia, the Philippines, Thailand, and Vietnam, over the period 1995 to 2021. Using a multi-method empirical strategy that integrates Stochastic Frontier Analysis (SFA), threshold regression, and quantile-based techniques, the analysis captures nonlinearities, distributional shifts, and institutional moderating effects within the resource-finance nexus. The results reveal that forest rents exert a positive and statistically significant effect on financial development, particularly at the median quantile and in economies with higher renewable energy adoption. In contrast, mineral and natural gas rents are negatively associated with credit expansion, especially in countries with weaker financial systems, suggesting the presence of a financial resource curse. Institutional quality and renewable energy consumption play crucial moderating roles by attenuating the adverse effects of rent dependency while enhancing financial sector efficiency. Efficiency estimates highlight Indonesia and the Philippines as regional frontrunners in transforming resource wealth into productive credit allocation. The study recommends integrating forest rents into green finance frameworks, strengthening governance mechanisms, and designing resource-sensitive financial deepening strategies. Overall, the findings offer timely insights to inform policy frameworks aligned with Sustainable Development Goals 8 and 9.