Impact of ICT diffusion and financial development on economic growth in developing countries

Several studies have proven a positive impact of information and communication technologies (ICT) on economic growth. Nevertheless, some studies have suggested a limited effect, while others have found no statistically significant effect. Faced with this problem, we conducted a study with the aim to assess the role of moderation of ICT diffusion between financial development and economic expansion in Saudi Arabia from 1990 to 2019. Using the bootstrap approach for the ARDL model, the results prove that financial development as well as ICT diffusion affect negatively (positively) economic development. The financial development interaction term with ICT diffusion has a positive and statistically significant effect on economic growth. The results suggest that ICT diffusion does not only directly impact economic growth but also increase the indirect impact of financial development on economic growth. This result indicates that ICT diffusion boosts the role of financial development in economic development. This means that financial development can only boost the Saudi economy when ICTs are well developed.

Economic development and information and communication technology (ICT) are found to move together in the present day era of globalization. ICT can contribute significantly in economic development of a region by providing adequate information at the minimum of time and cost, thereby enhancing productivity in different sectors of an economy. This fact is substantiated by several studies (Kraemer & Dedrick, 2001; Pohjola, 2001). Some country specific studies like that of Singapore (Wong, 2001) also highlighted similar results. ICT diffusion in the world has been quite rapid since the mid 1990s. While the developed countries have benefited substantially from the ICT growth, the developing countries could not reap similar benefits out of it which has resulted in emergence of a digital divide across the countries (Economist, 2000; Nkrumah, 2000; Norris, 2001). This divide is noticed not only across countries but also within a country and this is more prominent in developing economies like India. ICT diffusion is another area which needs more attention in India as it will lead to ICT access and application of ICT in real sectors to increase productivity and output. During the past one decade India has made rapid advances in ICT growth as reflected in the increase in the number of Internet connections and users. The growth of Internet connections and users in the country is shown in Table 1.

This paper studies the link between information and communication technology (ICT) diffusion, financial development and economic growth in the panel of 3 Gulf Cooperation Council (GCC) countries, namely, Oman, Qatar and United Arab Emirates from 2008 to 2021. Using the system GMM in a panel data analysis, we showed evidence of a positive association between financial development and economic growth. We also showed that ICT acted as a complement in the finance-growth relationship. The study recommends harmonizing public and private sector investments for a synergistic impact on ICT infrastructure and investing adequately in the financial system to promote economic growth in GCC countries. Economic policies would be approved to provide incentives and subsidies to guarantee affordable ICT services to disadvantaged peoples. In addition, training programs focused on improving digital literacy to enable all population groups to use digital platforms for financial services are recommended.

Purpose This study aims to examine the dynamic and asymmetric relationships between information and communication technology (ICT) diffusion, renewable energy consumption, financial development, electricity access and green economic growth in 40 African countries over the period 2000–2019. Design/methodology/approach Using both symmetric and nonlinear panel ARDL estimators (PMG and NARDL), the analysis explores the complex interactions among these variables and incorporates an interaction term between ICT and electricity access to capture the moderating role of social infrastructure. Findings The results indicate that ICT diffusion and renewable energy consumption significantly enhance green growth in the long run, while financial development has a negative and nonlinear effect, reflecting structural inefficiencies in African financial systems. Electricity access emerges as both, a direct driver of green growth and a moderator that strengthens the positive effect of ICT diffusion. Research limitations/implications The analysis is limited to 40 African countries over 2000–2019, and data constraints may affect the generalizability of the results. Practical implications The findings guide policymakers to prioritize ICT infrastructure, renewable energy investment and financial reforms to foster sustainable growth. Social implications Improved electricity access and digital inclusion can reduce inequality and ensure broader participation in the green economy. Originality/value This study contributes to green growth theory by integrating technological, financial and infrastructural dimensions, while also addressing the social implications of infrastructure access. It further provides actionable policy recommendations to promote digital inclusion, renewable energy investment and financial reforms for sustainable development in Africa.

The aims of this research work are to test the dynamic response of economic growth to financial development and information and communication technology (ICT), and to investigate whether the interaction of financial development with better ICT infrastructure can promote economic growth. Growth theories predict that financial development and ICT positively influence economic growth, but the results are mixed. Therefore, the current study examines the dynamic response of economic growth to financial development and information and communication technology (ICT) for eight selected sub-Saharan African (SSA) countries covering 2000–2021. Applying pooled mean groups and mean group estimators, the findings reveal that ICT enhances growth in SSA, but financial development is otherwise. The result further shows that with the interaction of ICT with financial development, economic growth is positively influenced. Since the region is still undergoing development, it is suggested that there should be more investment in the ICT infrastructure.

Purpose This study sought to examine the interaction between rural bank performance, information and communication technology (ICT) investment, ICT diffusion and financial development. Design/methodology/approach Data were sourced from the Association of Rural Banks (ARB) Apex and World Development Indicators (WDI) for the period 2014–2020. A total of 122 rural banks were used for this study. The study adopted the two-step system generalized method of moments (SGMM) estimation technique in assessing the interactions among variables. Findings This study found compelling evidence to support the positive effect of ICT investment on banks’ performance (return on asset and net interest margin). Further, ICT diffusion and financial development positively influence banks’ performance. The results show a positive moderating effect exerted by ICT diffusion and financial development on the impact of bank risk (bank stability) and ICT investment on all three performance measures. Originality/value The study focuses on the rural banking sector in the Ghanaian economy, compared to related studies that examine the subject matter for commercial banks. The moderating effects of ICT diffusion and financial development are assessed to guide policy on rural banking development in Ghana.

Although there is a wealth of evidence on the relationship between economic growth and poverty or poverty and information and communication technology (ICT), there are few studies on the interaction between the three factors. The triangle relationship between poverty, information and communication technology, and economic growth in SADC were investigated in this study from 2005 to 2019. The research looked at how ICT and economic growth impact poverty in SADC countries, using the instruments of the Mean-Group FMOLS, Mean-Group DOLS, and Robustness Mean-Group Estimators in achieving its major objective. The principal component analysis was employed in generating a single index value for ICT and the data were subjected to relevant econometric tests to achieve robust results. Findings showed that all the variables exhibited poverty-reducing effects in SADC except inflation. Results confirm the existence of the “leapfrogging” hypothesis for the region. It is necessary to strengthen existing bilateral links among member nations of the area to maintain the benefits of ICT’s poverty-reducing impacts, economic growth, financial development, and trade openness. As applicable in other advanced and some emerging economies, the digital competence of the region needs to be synchronized for effective ICT service delivery.

The need to prioritize sustainable development is expanding in light of the world's environmental concerns. To address these concerns, entrepreneurship is essential as a catalyst for inventions, economic expansion, and social change. Entrepreneurship activities have direct and indirect effects in the face of environmental risks and uncertainties. This study addresses gaps in understanding entrepreneurship's non-linear and complementarity effects, particularly opportunity-driven entrepreneurship and information and communication technologies (ICT), on the quality of the environment in Saudi Arabia. The dynamic ordinary least squares (DOLS) method is used to estimate long-run relationships. Saudi Arabia will be the perfect context for sustainability because the country has prioritized sustainability through its Vision 2030, and the Saudi government has substantially supported entrepreneurship. The main contribution of this paper to the existing literature is evident in its examination of the quadratic relationships between both opportunity-driven entrepreneurship and ICT diffusion, including ICT access, use, and skills, on environmental quality. In addition, the study delves into the ICT diffusion's modulating effects on the nexus of opportunity entrepreneurship with environmental quality, providing insights into how these factors can effectively improve environmental quality. The findings show that opportunity entrepreneurship and ICT diffusion initially deteriorate environmental quality before leading to improvements as their levels mature in the economy. Moreover, interactions between ICT proxies and opportunity entrepreneurship yield mixed effects, with negative net effects on CO2 emissions and ecological footprint countered by positive net effects on the environmental performance index. These findings highlight the dual role of ICT diffusion as a contributor to environmental challenges and a potential solution, depending on the level of its diffusion and interaction with entrepreneurial activities. Therefore, policymakers should create plans that encourage and direct business activity toward more environmentally friendly methods. They should also consider the short- and long-term effects of growing digital technologies on environmental sustainability and how they might revolutionize how entrepreneurship and sustainability goals are aligned.

This study contributes to the literature by investigating the intervening role of information and communication technology (ICT) diffusion on insurance and economic growth in Sub-Saharan Africa (SSA). This study uses the generalized method of moments technique based on 36 countries, spanning 2007–2020. First, the empirical findings reveal that insurance penetration (i.e. total, life and nonlife) and ICT diffusion induce economic growth in SSA. Second, the evidence suggests that ICT boosts the role of insurance in affecting economic growth. Third, the individual ICT variables such as fixed broadband, telephone and internet propel the impact of total and life penetration on growth. Additionally, fixed broadband was remarkable in enhancing the effect of nonlife penetration on growth. The findings imply that though insurance enhances economic growth, its impact is more revealing through the intervening role of ICT infrastructure. Therefore, insurers must embrace technology and leverage ICT development to improve their performance on growth.

This study investigates the impact of financial development on information and communication technology (ICT) in sub-Saharan Africa. The analysis utilizes a panel dataset comprising 48 countries from the region and employs the bootstrap ordinary least squares (OLS) technique to ensure accurate and robust results. The findings reveal a significant and positive relationship between financial development and ICT indicators. Panel unit root tests indicate a combination of non-stationary behavior and stationarity after differencing the variables. Panel cointegration tests confirm a long-run, continuous cointegration between financial development and ICT infrastructure. The empirical results demonstrate significant cointegration between financial development and various ICT indicators, including internet usage, mobile subscriptions, telephone subscriptions, and fixed broadband subscriptions. The bootstrap OLS method further reveals that financial development has a statistically significant impact on the development of these ICT indicators. The results are robust, as confirmed by the Driscoll-Kraay standard errors regression. Based on these findings, policy recommendations are provided to enhance the synergy between financial development and ICT in sub-Saharan Africa, including promoting financial inclusion, investing in ICT infrastructure, strengthening financial sector regulations, fostering public-private partnerships, investing in digital skills and education, and supporting entrepreneurship and innovation.

How do financial development and ICT moderate financial resource curse hypothesis in developing countries?

Over the past three decades, there has been a significant increase in information and communication technology (ICT) investments around the world, resulting in a rise in the use of modern ICT packages. Sub‐Saharan African (SSA) countries, however, face different challenges. This study examines the relationship between ICT diffusion, foreign direct investment (FDI), trade openness, and economic globalization on inclusive growth for 48 SSA countries during 2005–2020. We use the modified generalized method of moments method for estimation. Empirical results reveal that ICT has a positive and significant influence on inclusive growth, while trade and economic globalization have a negative impact. FDI, on the other hand, has a favorable and considerable effect on inclusive growth. Inflation and vulnerable employment have negative impacts on inclusive growth, whereas social protection has a positive impact. From a policy standpoint, it is recommended that policymakers focus on enhancing ICT penetration in the region, particularly integrating ICT into the educational system to improve learning effectiveness and reduce research costs. Additionally, the interaction between economic globalization and ICT diffusion can enhance inclusive growth. Therefore, macroeconomic policies should promote ICT development, implement sound trade agreements, and attract capital inflows for inclusive economic growth. ICT diffusion is deemed both necessary and sufficient for SSA's advancement.

Purpose This study aims to examine the relationship between information and communication technology (ICT) and economic growth in all organization for economic co-operation and development (OECD) countries. Design/methodology/approach This paper employs annual panel data together with fixed-effects (FE), random effects (RE), fully modified ordinary least squares (FMOLS), dynamic ordinary least squares (DOLS) and generalized method of moments (GMM) estimators for production function estimation. Findings The results indicate that ICTs, non-ICT (NICT) capital services and employment significantly and positively affect economic growth. Practical implications Information is an important driving force behind economic growth and productivity, and communication technologies have made it more accessable. Also, many countries aimed to invest in ICT to improve their economic growth and productivity. However, these investments failed to produce the expected outcome for some years and countries. Originality/value To our knowledge, no study examines the ICT and growth relation in all OECD countries for 2000–2018 period. We intend to fill this gap by examining whether or not the expected returns from ICT investment are achieved in all OECD countries between 2000 and 2018.

Previous studies have shown that in the higher education sector, information and communication technology (ICT) provides the impetus for change from the traditional concepts of teaching and learning, as well as prime motivation behind the change in scholarly and professional activities. This underscores the importance of ICT in higher education in achieving the goal of providing flexible teaching and learning environments. Consequently, the aim of this study was to answer the empirical question as to what environmental, technological, organizational and individual factors are most likely to influence choice behaviour to use ICT in student learning in Kenyan higher education. Path analysis statistical techniques in structural equation modelling were used. The findings show that environmental, technological, organizational and individual factors play a significant role in ICT diffusion and infusion. It was further observed that the effects of some factors including availability of ICT, access to ICT, and the characteristics of the institution's chief executive officer play a pivotal role in ICT diffusion in a developing country context. This study produced useful insights into the factors that influence technology acceptance decisions by students, and provided new ideas for the management of ICT diffusion and infusion.

Hitherto studies regarding ICT diffusion at national/local level mainly focuses on economic growth only by enhanced productivity in domestic industries. As ICT plays a role of General Purpose Technology with its variability and adaptability, this research raise the issue about the relationship between human progress and information and communication technology (ICT) at the national level. Author conducts empirical studies with broader and qualitative factor with ICT diffusion through cross-country panel analysis method to test the hypotheses. The results confirm that ICT can drive human progress at the national level, and also contributes to academia for inspecting future changes with human progress with similar studies.