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Telecommunications Infrastructure And Economic Growth: Evidence From Developing Countries

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  • Sridhar, Kala Seetharan
  • Sridhar, Varadharajan

Abstract

In this study, we investigate empirically the relationship between telephone penetration and economic growth, using data for developing countries. Using 3SLS, we estimate a system of equations that endogenizes economic growth and telecom penetration. We find that the traditional economic factors explain demand for mainline and mobile phones, even in developing countries. We find positive impacts of mobile and landline phones on national output, when we control for the effects of capital and labor. We discuss the associated policy implications related to improvement of telecom penetration in developing countries.

Suggested Citation

  • Sridhar, Kala Seetharan & Sridhar, Varadharajan, 2007. "Telecommunications Infrastructure And Economic Growth: Evidence From Developing Countries," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 7(2), pages 37-56.
    • Handle: RePEc:eaa:aeinde:v:7:y:2007:i:2_3
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    References listed on IDEAS

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    More about this item

    Keywords

    Telecommunication; Economic growth; Reverse causality; Developing countries; Telephones;
    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
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries
    • L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications
    • H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures

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