In this paper, we analyze the complex relationship between gold production, terrorism and economic performance in fıve resource-rich countries—Colombia, the Democratic Republic of Congo, Indonesia, Mali, and the Philippines—over the period 1975-2023. Using the Bootstrapping Auto Regressive Distributed Lag Bounds (BARDL) test augmented with Fourier approximation (FBARDL) and a Granger causality framework based on the Fourier VAR model, the analysis incorporates additional variables, including foreign direct investment (FDI), trade openness, IBRD loans and IDA credits, and financial development. According to the test results, terrorist attacks have negative effects on economic growth and development for all countries. Gold production, by contrast, contributes positively to economic growth in both the short and long run, challenging the conventional resource curse hypothesis. However, this growth does not translate into broader economic development, suggesting a disconnect between resource-driven expansion and improvements in human development indicators. Granger causality analysis further indicates that terrorism has an immediate and enduring impact on economic growth, while the reverse causality varies by country. Notably, gold production is found to have a unidirectional causal effect on terrorism in Indonesia, whereas bidirectional causality is observed in Colombia, the DRC, and Mali. These results underscore the complex and context-specific nature of the relationship between resource extraction, security, and development, offering critical insights for policymakers seeking to reconcile economic growth with institutional stability and social progress. • Findings highlight complex links among gold production, terrorism, and development. • Gold production contributes to the economic growth, but not economic development. • Gold production has a unidirectional causal effect on terrorism in Indonesia. • Bidirectional causality between gold production and terrorism is observed in Colombia, the DRC, and Mali.
Bildirici et al. (Fri,) studied this question.