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The impact of ICT capital growth on economic growth: the case of Egypt

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  • Hoda Mansour

    (University of Business and Technology, College of Business Administration, Jeddah, Saudi Arabia)

Abstract

Capital investments in information and communication technology (ICT) have been a major contributor to the growth of several developed countries. In an attempt to boost their economies, some emerging and developing countries have been following a similar path, in which they heavily invest in the sector of ICT. However, due to other factors, ICT capital growth may not always produce the desired economic outcome. The purpose of this study is to estimate the impact of capital growth in ICT on economic growth in one developing country, Egypt, which has been heavily investing in the sector of ICT. The study analyses time series data covering the period from 1999 to 2019 using an error correction model. The findings demonstrate that there is no long-term positive association between ICT capital growth and economic growth in Egypt. While the development of ICT provides the potential for Egypt to achieve sustained economic growth, the significance and size of these impacts are currently negligible. The study concluds that in order to benefit from capital investments in ICT, policymakers should enact high-quality investment policies and improve the overall quality of the surrounding environment, such as the regulatory and institutional environments, in addition to controlling inflation and government consumption.

Suggested Citation

  • Hoda Mansour, 2022. "The impact of ICT capital growth on economic growth: the case of Egypt," Zbornik radova Ekonomskog fakulteta u Rijeci/Proceedings of Rijeka Faculty of Economics, University of Rijeka, Faculty of Economics and Business, vol. 40(2), pages 375-394.
    • Handle: RePEc:rfe:zbefri:v:40:y:2022:i:2:p:375-394
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    More about this item

    Keywords

    economic growth; ICT; capital growth; digital economy;
    All these keywords.

    JEL classification:

    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology

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