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Information technology, real sector and economic growth in sub-Saharan Africa: a cross-sectional dependence approach

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  • Taiwo Akinlo

    (Adeyemi College of Education)

  • James Temitope Dada

    (Obafemi Awolowo University)

Abstract

This study examines the moderating role of real sector output in information technology-economic growth nexus in twenty-six sub-Saharan countries, for the period from 2000 to 2019. Three variables are used to proxy the real sector namely; industrial value-added, agriculture value-added, and total factor productivity; while information technology is proxy using a mobile phone, fixed telephone, and internet penetration. Furthermore, pooled ordinary least squares/weighted least squares, fixed-effects (within), and generalized least squares within Driscoll-Kraay standard error are used as estimation techniques to address the problem of cross-sectional dependence. The findings reveal that information technology has a mixed effect on economic growth in sub-Saharan African countries. On the interactive term of information technology and real sector output, the study found that only the interaction of agriculture value-added and information technology produces a positive effect on economic growth. The interaction of industrial value-added and information technology produces a negative effect on economic growth while the interaction of total factor productivity and information technology produces an insignificant effect on economic growth. This implies that for countries to benefit from the growth potentials of information technology, absorptive capacity such as the real sector needs to be strengthened.

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  • Taiwo Akinlo & James Temitope Dada, 2022. "Information technology, real sector and economic growth in sub-Saharan Africa: a cross-sectional dependence approach," Quality & Quantity: International Journal of Methodology, Springer, vol. 56(6), pages 4241-4267, December.
    • Handle: RePEc:spr:qualqt:v:56:y:2022:i:6:d:10.1007_s11135-021-01308-2
    DOI: 10.1007/s11135-021-01308-2
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    More about this item

    Keywords

    Information technology; Real sector output; Economic growth; Sub-Saharan Africa; Driscoll-Kraay;
    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
    • O55 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Africa

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