IDEAS home Printed from https://ideas.repec.org/p/imf/imfwpa/2006-258.html
   My bibliography  Save this paper

Financial Development, the Structure of Capital Markets, and the Global Digital Divide

Author

Listed:
  • Charles Amo Yartey

Abstract

This paper examines the role of financial development and financial structure in explaining cross-country diffusion of information communication technology (ICT). Using panel data for 76 emerging and advanced countries for the period 1990-2003, the paper finds that credit and stock market development tends to foster ICT development. Financial structure, however, does not appear to have any significant relationship with ICT development. The conclusions of the paper highlight the role of financial development in the market for knowledge-based products, and are consistent with theoretical predictions. The finding that financial development is an important determinant of ICT development implies that countries with underdeveloped financial markets may continue to lag behind in the use of ICT.

Suggested Citation

  • Charles Amo Yartey, 2006. "Financial Development, the Structure of Capital Markets, and the Global Digital Divide," IMF Working Papers 2006/258, International Monetary Fund.
    • Handle: RePEc:imf:imfwpa:2006/258
    as

    Download full text from publisher

    File URL: http://www.imf.org/external/pubs/cat/longres.aspx?sk=19924
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Leonardo Becchetti & Fabrizio Adriani, 2005. "Does the digital divide matter? The role of information and communication technology in cross-country level and growth estimates," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 14(6), pages 435-453.
    2. Black, Bernard S. & Gilson, Ronald J., 1998. "Venture capital and the structure of capital markets: banks versus stock markets," Journal of Financial Economics, Elsevier, vol. 47(3), pages 243-277, March.
    3. Menzie D. Chinn & Robert W. Fairlie, 2007. "The determinants of the global digital divide: a cross-country analysis of computer and internet penetration," Oxford Economic Papers, Oxford University Press, vol. 59(1), pages 16-44, January.
    4. Singh, Ajit & Dhumale, Rahul, 2000. "Globalization, Technology, and Income Inequality A Critical Analysis," WIDER Working Papers 295543, United Nations University, World Institute for Development Economic Research (UNU-WIDER).
    5. repec:reg:rpubli:343 is not listed on IDEAS
    6. Saint-Paul, Gilles, 1992. "Technological choice, financial markets and economic development," European Economic Review, Elsevier, vol. 36(4), pages 763-781, May.
    7. Sanjeev Dewan & Kenneth L. Kraemer, 2000. "Information Technology and Productivity: Evidence from Country-Level Data," Management Science, INFORMS, vol. 46(4), pages 548-562, April.
    8. Allen, Franklin & Gale, Douglas, 1999. "Diversity of Opinion and Financing of New Technologies," Journal of Financial Intermediation, Elsevier, vol. 8(1-2), pages 68-89, January.
    9. Kiiski, Sampsa & Pohjola, Matti, 2002. "Cross-country diffusion of the Internet," Information Economics and Policy, Elsevier, vol. 14(2), pages 297-310, June.
    10. Dale W. Jorgenson, 2001. "Information Technology and the U.S. Economy," Higher School of Economics Economic Journal Экономический журнал Высшей школы экономики, CyberLeninka;Федеральное государственное автономное образовательное учреждение высшего образования «Национальный исследовательский университет «Высшая школа экономики», vol. 5(1), pages 3-34.
    11. Dasgupta, Susmita & Lall, Somik & Wheeler, David, 2001. "Policy reform, economic growth, and the digital divide - an econometric analysis," Policy Research Working Paper Series 2567, The World Bank.
    12. Wallsten, Scott, 2003. "Regulation and internet use in developing countries," Policy Research Working Paper Series 2979, The World Bank.
    13. Wong, Poh-Kam, 2002. "ICT production and diffusion in Asia Digital dividends or digital divide?," Information Economics and Policy, Elsevier, vol. 14(2), pages 167-187, June.
    14. Ajit Singh, 1998. "Financial liberalisation, stockmarkets and economic development," Nova Economia, Economics Department, Universidade Federal de Minas Gerais (Brazil), vol. 8(1), pages 165-182.
    15. Beilock, Richard & Dimitrova, Daniela V., 0. "An exploratory model of inter-country Internet diffusion," Telecommunications Policy, Elsevier, vol. 27(3-4), pages 237-252, April.
    16. Singh, Ajit & Singh, Alaka & Wiesse, Bruce, 2000. "Information technology, venture capital and the stock market," MPRA Paper 53718, University Library of Munich, Germany.
    17. Manuel Arellano & Stephen Bond, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 58(2), pages 277-297.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Bruno Caprettini, 2008. "Finance and the Diffusion of Digital Technologies," Rivista di Politica Economica, SIPI Spa, vol. 98(6), pages 79-122, November-.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Yartey, Charles Amo, 2008. "Financial development, the structure of capital markets, and the global digital divide," Information Economics and Policy, Elsevier, vol. 20(2), pages 208-227, June.
    2. Mekuria, Teklemariam & Kwon, Youngsun, 2017. "Investigating the Influence of Bridging the Digital Divide on Economic Growth and Corruption Control: Lessons from Developmental Economies to Developing Countries. The case of East African Countries," 14th ITS Asia-Pacific Regional Conference, Kyoto 2017: Mapping ICT into Transformation for the Next Information Society 168520, International Telecommunications Society (ITS).
    3. P. Guerrieri & M. Luciani & V. Meliciani, 2011. "The determinants of investment in information and communication technologies," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 20(4), pages 387-403.
    4. Francesco Venturini, 2009. "The long-run impact of ICT," Empirical Economics, Springer, vol. 37(3), pages 497-515, December.
    5. Szeles, Monica Răileanu, 2018. "New insights from a multilevel approach to the regional digital divide in the European Union," Telecommunications Policy, Elsevier, vol. 42(6), pages 452-463.
    6. Paolo Guerrieri & Sara Bentivegna (ed.), 2011. "The Economic Impact of Digital Technologies," Books, Edward Elgar Publishing, number 14361.
    7. Shchetinin, Oleg & Baptiste, Massenot, 2008. "How to Overcome the Digital Divide? The Determinants of Internet Diffusion," MPRA Paper 9413, University Library of Munich, Germany.
    8. Margarita Billon & Fernando Lera-Lopez & Rocío Marco, 2010. "Differences in digitalization levels: a multivariate analysis studying the global digital divide," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 146(1), pages 39-73, April.
    9. Li, Raymond & Shiu, Alice, 2012. "Internet diffusion in China: A dynamic panel data analysis," Telecommunications Policy, Elsevier, vol. 36(10), pages 872-887.
    10. Feng, Guangchao Charles, 2015. "Determinants of Internet diffusion: A focus on China," Technological Forecasting and Social Change, Elsevier, vol. 100(C), pages 176-185.
    11. Ren, Siyu & Hao, Yu & Xu, Lu & Wu, Haitao & Ba, Ning, 2021. "Digitalization and energy: How does internet development affect China's energy consumption?," Energy Economics, Elsevier, vol. 98(C).
    12. Ajit Singh & Jack Glen & Ann Zammit & Rafael De-Hoyos & Alaka Singh & Bruce Weisse, 2005. "Shareholder Value Maximisation, Stock Market and New Technology: Should the US Corporate Model be the Universal Standard?," International Review of Applied Economics, Taylor & Francis Journals, vol. 19(4), pages 419-437.
    13. Dohse, Dirk & Lim, Cheng Yee, 2016. "Macro-geographic location and internet adoption in poor countries: What is behind the persistent digital gap?," Kiel Working Papers 2067, Kiel Institute for the World Economy (IfW Kiel).
    14. James B. Ang, 2008. "A Survey Of Recent Developments In The Literature Of Finance And Growth," Journal of Economic Surveys, Wiley Blackwell, vol. 22(3), pages 536-576, July.
    15. Menzie D. Chinn & Robert W. Fairlie, 2007. "The determinants of the global digital divide: a cross-country analysis of computer and internet penetration," Oxford Economic Papers, Oxford University Press, vol. 59(1), pages 16-44, January.
    16. Bera, Subhasis, 2019. "Club convergence and drivers of digitalization across Indian states," Telecommunications Policy, Elsevier, vol. 43(8), pages 1-1.
    17. Charles Shaaba Saba & Oladipo Olalekan David, 2023. "Identifying Convergence in Telecommunication Infrastructures and the Dynamics of Their Influencing Factors Across Countries," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 14(2), pages 1413-1466, June.
    18. Richard Perkins & Eric Neumayer, 2011. "Is the internet really new after all?: the determinants of telecommunications diffusion in historical perspective," LSE Research Online Documents on Economics 30800, London School of Economics and Political Science, LSE Library.
    19. Clarke, George R.G. & Wallsten, Scott J., 2004. "Has the internet increased trade? Evidence from industrial and developing countries," Policy Research Working Paper Series 3215, The World Bank.
    20. Johnston, Craig M.T., 2016. "Global paper market forecasts to 2030 under future internet demand scenarios," Journal of Forest Economics, Elsevier, vol. 25(C), pages 14-28.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:imf:imfwpa:2006/258. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Akshay Modi (email available below). General contact details of provider: https://edirc.repec.org/data/imfffus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.