Information and communication technologies (ICT) play a central role in the transition to knowledge - based economies. In this paper we analyse the effects of human capital in fostering output growth in ICT manufacturing and services using data from a sample of twenty OECD countries over the period 1980-2002. We focus on within country between industry differences and estimate a system of simultaneous equations to account for simultaneous effects of human capital on physical investment and output growth. The results of our econometric analysis suggest that countries with a high human capital stock experienced faster output growth in ICT producing manufacturing and ICT using services. Also, in countries with high human capital improvement over the analysed period output grew relatively faster in ICT producing manufacturing industries. Furthermore, we find that past country level educational attainment reflected in the human capital stock and human capital accumulation over the analysed period had a direct positive and significant effect on physical capital investment. Our findings indicate that in developed countries human capital is an important factor driving the ICT industries growth.
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Paper provided by Economic and Social Research Institute (ESRI) in its series Papers with number
DYNREG07.
Length: 26 pages Date of creation: 2007 Date of revision: Handle: RePEc:esr:wpaper:dynreg07
Note: DYNREG Research Project – Dynamic Regions in a Knowledge-Driven Global Economy: Lessons and Policy Implications for the European Union Contact details of provider: Postal: Whitaker Square, Sir John Rogerson's Quay, Dublin 2 Phone: (353-1) 863 2000 Fax: (353-1) 863 2100 Email: Web page: http://www.esri.ie More information through EDIRC
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Find related papers by JEL classification: E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies O33 - Economic Development, Technological Change, and Growth - - Technological Change - - - Technological Change: Choices and Consequences; Diffusion Processes
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