Financial globalization, technological innovation, and human development in Asean-6 countries: evidence from a panel VAR approach

This research aims to investigate the central role of financial globalization in promoting human development across the six ASEAN economies. This role is assessed both through its direct influence on human development as well as its indirect one mediated by technological innovation. For the estimation, the study employs the panel vector autoregressive (panel VAR) framework. The findings indicate that financial globalization plays a key role in fostering human development in the ASEAN economies. Indeed, financial globalization not only exerts a direct positive effect on human development but may also generate indirect ones through technological innovation. The findings distinguish the present study from existing research. They provide deeper insights into the central role of financial globalization in human development, which is manifested both through its direct effects and its indirect ones channeled through technological innovation. It offers valuable empirical evidence that can serve as a reference for future in-depth investigations on this issue, particularly for those seeking to clarify the pivotal role of financial globalization in a global context. The findings practically constitute a solid foundation for the ASEAN-6 nations to formulate appropriate policies aimed at fostering human development, grounded in the understanding that financial globalization may exert a direct impact on human development as well as an indirect one through technological innovation.