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Financial development, the structure of capital markets, and the global digital divide

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  • Yartey, Charles Amo

Abstract

This paper examines the extent to which financial development and financial structure may explain cross-country diffusion of information communication technology (ICT). Using panel data for 76 emerging and advanced countries for the period 1990-2003, it finds that credit and stock market development tends to foster ICT diffusion, but financial structure does not appear to have any significant relationship with it. The conclusions, which are consistent with what theory might predict, highlight the role of financial development in the market for knowledge-based products. The finding that financial development is an important determinant of ICT diffusion implies that countries with underdeveloped financial markets may sink even further to the information-poor and noncommunicating side of the global digital divide.

Suggested Citation

  • 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.
  • Handle: RePEc:eee:iepoli:v:20:y:2008:i:2:p:208-227
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    References listed on IDEAS

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    Cited by:

    1. Marianna Belloc & Paolo Guerrieri, 2015. "Impact of ICT diffusion and adoption on sectoral industrial performance: evidence from a panel of European countries," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 32(1), pages 67-84, April.
    2. Lechman, Ewa & Marszk, Adam, 2015. "ICT technologies and financial innovations: The case of exchange traded funds in Brazil, Japan, Mexico, South Korea and the United States," Technological Forecasting and Social Change, Elsevier, vol. 99(C), pages 355-376.
    3. Srinuan, Chalita & Bohlin, Erik, 2011. "Understanding the digital divide: A literature survey and ways forward," 22nd European Regional ITS Conference, Budapest 2011: Innovative ICT Applications - Emerging Regulatory, Economic and Policy Issues 52191, International Telecommunications Society (ITS).

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