Fin-tech indicators, mineral resources and green productivity: Role of human development and globalization in BRICS region

Abstract

Fin-tech facilitates capital allocation for sustainable mineral extraction, fostering green productivity. Fin-tech platforms empower communities to invest in renewable, driving eco-friendly practices in mineral-rich areas. Despite its significant importance, the influence of fin-tech and mineral resources is relatively under-explored, particularly in the BRICS region, mainly due to the unavailability of inclusive fintech indicators. This study initially constructs fintech index based on financial development and digitalization indicators. Although it does not purely reflect fintech, however, it is a good proxy for the readiness of fintech. Later, this study explores the nonlinear dynamics of fintech and mineral resources after controlling the impact of human development and globalisation on the green productivity of the BRICS countries from 1990 to 2021. Nonlinear Autoregressive Distributed Lag (NARDL) model is employed after the preliminary examination of the data series. The bound test of the cointegration approach is used to establish the long-run equilibrium relationship between the variables. Wald test affirms the asymmetries/non-linearities in financial technology and mineral resources. The long-run outcomes of NARDL reveal positive and negative shocks in financial technology and mineral resources cause to influence green productivity differently. Positive shock in fin-tech (mineral rent) leads to a 0.251% (0.437) increase (decreased) in green productivity, while negative shows a reduction (increases) by 0.308% (114%). Human development and globalisation positively impact green productivity in the long and short run. The error correction term is negative and significant, implying that the applied model settles 46.1% of asymmetric discrepancies annually. The study emphasises enhancing the financial technology sector in the BRICS countries.