Beyond the Resource Curse: Energy Structure and Sustainable Economic Growth in Kazakhstan

Abstract

Achieving sustainable economic growth in resource-rich economies remains a major challenge in the context of the global energy transition. While fossil fuel dependence has historically supported economic expansion, it has also generated structural vulnerabilities associated with the resource curse. This study examines whether changes in energy structure can help move beyond the resource curse in Kazakhstan, a fossil-fuel-dependent transition economy. Using annual data for the period 1993–2023, the analysis applies the Autoregressive Distributed Lag (ARDL) bounds testing approach to investigate the short- and long-term relationships between per capita income, fossil fuel consumption, renewable energy production, carbon emissions, and capital formation. The results provide evidence of a long-term association, supported mainly by the error-correction mechanism. Fossil fuel consumption exerts a statistically significant negative effect on per capita income, supporting the resource curse hypothesis. In contrast, renewable energy production does not show a statistically significant impact on economic growth, suggesting that its contribution to economic growth remains limited within the sample period. Overall, the findings highlight the importance of energy diversification and structural transformation of the energy sector for aligning energy transition strategies with sustainable development objectives in resource-rich economies.