Human Capital and the Development of Non-Wood Forest Products: An Econometric Analysis of Livelihood Capital Mechanisms in Koyten Dag, Turkmenistan

This research explores how livelihood capital endowments affect the growth of Non-Wood Forest Products (NWFPs) in rural communities in the Koyten Dag region of Turkmenistan. This study is grounded in the Sustainable Livelihoods Framework. It draws on the Capability Approach, Institutional Theory, and Human Capital Theory, which are considered to have a strong influence on NWFP development within the exclusive post-Soviet socio-ecological environment. This study also uses annual time-series data from 2001 to 2024. It applies the ARDL bounds testing method to examine the short- and long-run associations among livelihood assets and NWFP production. The results confirm strong long-run co-integration, indicating that the five capitals have a significant impact on NWFP development. Emerging as the ultimate drivers in both the short and long term, education, skills, health, and digital connectivity become especially important. Financial and social capital reflect long-term contributions, while natural capital highlights the significance of the availability of ecological resources and governance systems. The correction error term indicates a rapid rate of adjustment, suggesting that the livelihood system is robust and can return to equilibrium quickly in response to temporary shocks. This research uses the Autoregressive Distributed Lag (ARDL) method of co-integration, which is effective for small-sample analyses of long-run relationships. The empirical analysis is conducted in a systematic process, which is the unit root tests based on augmented Dickey–Fuller (ADF) and Phillips–Perron (PP) techniques, in order to establish the order of integration of variables. The Akaike Information Criterion (AIC) is used to determine the appropriate lag length for the ARDL model to achieve the best model specification. In the robustness analysis, we perform fully modified OLS (FMOLS) and dynamic OLS (DOLS) estimation. Sub-period analysis was performed to test structural breaks. The variance inflation factor (VIF) test was used to detect multicollinearity. This paper has significant theoretical and practical implications, including the need for policies that are integrative and, at the same time, enhance human capabilities, digital infrastructure, institutional quality, and resource governance. This knowledge can be used to promote the sustainable development of rural areas and as an efficient approach to the NWFP sector in Turkmenistan.