Measuring the Impact of ICT Investments on Economic Growth
Type of work: Working Paper
Categories:Economics | ICT4D
Abstract: Measuring the impact of ICT investment on economic growth has been thoroughly examined for a number of industrialized countries. This study provides a cross-country view on this issue by assessing the impact of ICT on economic growth for 50 major ICT-spending countries, which together account for over 90% of the global ICT market. We find that the key determinants of the variance of ICT contribution to growth across economies include education, institutional quality, openness, and English fluency. Furthermore, ICT investment has a significant impact on economic growth not only as traditional investment, but also as a boost to efficiency in growth: a higher level of ICT capital stock per capita allows an economy to achieve a higher growth rate for given levels of growth in labor and capital inputs.