Natural resources extraction and geopolitical risk: Examining oil resources extraction in China

This study examines the disaggregated impact of natural resource rents, including natural gas, forest, and oil rents, on China's economic performance. Additionally, we investigate the interactive relationship between geopolitical risk and research and development expenditure. Our econometric analyses, including unit root tests, cointegration analysis using the Bayer-Hanck model, and robustness tests, suggest that oil rents negatively impact China's economic performance, while forest and natural gas rents enhance it. Moreover, we observe that geopolitical risk negatively influences economic performance, while research and development expenditure has a positive effect. Increasing research and development, spending can promote efficient resource utilization and support China's economic growth. Our study's robustness and validity were confirmed through various tests, and we recommend that policymakers and scholars take measures to minimize geopolitical risk while evaluating the relationship between resource rents and economic performance. Overall, our research provides valuable insights into the challenges associated with natural resources and their impact on economic development, contributing to ongoing efforts to promote sustainable economic growth in China. •The study explains how geopolitical risk, R&D investment, and natural resource rents affected China's economic performance.•The study used advanced and robust econometrics techniques.•Forest and natural gas rents improve economic performance, whereas oil rents damage it, confirming the resource curse.•Research and development point to a positive impact on economic performance, and geopolitical risk has a negative impact.•Increased research and development investment will strongly affect economic growth and resource efficiency.