The Impact of ICT on Economic Growth Using ICT Development Index A Case Study of Selected Countries

Subject Areas : International Journal of Finance, Accounting and Economics Studies

Taghi Torabi ¹ , Farzolah Ebrahimi ² , Farhad Ghaffari ³ , Karim Emami Jaze ⁴ , Kambiz Peykarjou ⁵

1 - Department of Management and Economic, Science and Research branch, Islamic Azad University, Tehran, Iran
2 - Department of Management and Economic, Science and Research branch, Islamic Azad University, Tehran, Iran
3 - Department of Management and Economic, Science and Research branch, Islamic Azad University, Tehran, Iran
4 - Department of Management and Economic, Science and Research branch, Islamic Azad University, Tehran, Iran
5 - Department of Management and Economic, Science and Research branch, Islamic Azad University, Tehran, Iran

Received: 2021-01-21 Accepted : 2021-05-16 Published : 2022-06-09

Keywords: Economic growth, Panel data, Labor Forces productivity, Information and Communication Technology (ICT), ICT Development Index (IDI),

Abstract :

The present study was to investigation the impact of information and communication technology (ICT) by using the ICT Development Index (IDI) and other economic policy variables on economic growth of the selected countries including some MENA group and some other countries in the region for the period 2010-2017 using a panel-GMM type of growth model. The results extracted from the integrated econometric model showed that elasticity in ICT section, it was estimated to be 0.175 and statistically significant. This means that one percent increase in ICT Development Index (IDI) caused economic growth to increase by 0.175 percent, respectively. Moreover, the impact of variables such as GDP per capita in the past period and exogenous rate of growth of the labor force were negative and the impact of the explanatory variables such as Gross Fixed Capital Formation, Educational Development Index and ICT Development Index were positive on the economic growth of the countries. All elasticities were statistically significant and close to theoretical expectations. Also by decomposing IDI into sub-indexes and estimation the models, the elasticities were estimated for IDI access sub-index (0.204), for IDI use sub-index (0.030) and for IDI skills sub-index (-0.093) and statistically significant.