IDEAS home Printed from https://ideas.repec.org/a/gam/jworld/v6y2025i2p70-d1659639.html
   My bibliography  Save this article

Artificial Intelligence Investment in Resource-Constrained African Economies: Financial, Strategic, and Ethical Trade-Offs with Broader Implications

Author

Listed:
  • Victor Frimpong

    (Management Department, SBS Swiss Business School, 8302 Zurich, Switzerland)

Abstract

This paper argues that investing in artificial intelligence (AI) in developing economies involves significant trade-offs requiring ethical, financial, and geopolitical scrutiny. While AI is increasingly seen as a vehicle for technological leapfrogging, such ambitions often mask structural constraints, including weak infrastructure, limited institutional capacity, and external dependency. Using the economic theory of opportunity cost—extended through the political economy and digital governance perspectives—this study critically examines AI policy strategies in Ghana, Kenya, and Rwanda. A qualitative design grounded in secondary data and a thematic analysis reveal how AI investment may reallocate scarce resources away from essential services, exacerbate inequality, and entrench strategic technological dependency. This paper proposes a public policy framework built on four principles—sequential readiness, strategic alignment, ethical governance, and capacity building—to guide equitable AI deployment. It argues for establishing a digital social compact between states, citizens, and technology actors to safeguard public interest in AI-driven development. Finally, this paper outlines a future research agenda emphasizing the mixed-method evaluation of AI’s long-term social impacts, including employment, inclusion, and public service delivery.

Suggested Citation

  • Victor Frimpong, 2025. "Artificial Intelligence Investment in Resource-Constrained African Economies: Financial, Strategic, and Ethical Trade-Offs with Broader Implications," World, MDPI, vol. 6(2), pages 1-17, May.
  • Handle: RePEc:gam:jworld:v:6:y:2025:i:2:p:70-:d:1659639
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2673-4060/6/2/70/pdf
    Download Restriction: no

    File URL: https://www.mdpi.com/2673-4060/6/2/70/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Dani Rodrik, 2018. "Populism and the economics of globalization," Journal of International Business Policy, Palgrave Macmillan, vol. 1(1), pages 12-33, June.
    2. Liping Fu & Huajun Sun & Yuan Meng & Jiaxin Li, 2022. "The Role of Public–Private Partnerships in Local Government Debt Is a Potential Threat to Sustainable Cities: A Case from China," Sustainability, MDPI, vol. 14(21), pages 1-20, October.
    Full references (including those not matched with items on IDEAS)

    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. Manuel Funke & Moritz Schularick & Christoph Trebesch, 2023. "Populist Leaders and the Economy," American Economic Review, American Economic Association, vol. 113(12), pages 3249-3288, December.
    2. Vigvári, Gábor, 2022. "Transzformáció és a populizmus a visegrádi országokban [Transformation and populism in the V4 countries]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(3), pages 339-366.
    3. Marco Manacorda & Guido Tabellini & Andrea Tesei, 2022. "Mobile internet and the rise of political tribalism in Europe," CEP Discussion Papers dp1877, Centre for Economic Performance, LSE.
    4. Charles Goodhart & Rosa Lastra, 2018. "Populism and Central Bank Independence," Open Economies Review, Springer, vol. 29(1), pages 49-68, February.
    5. Andrés Rodríguez-Pose & Neil Lee & Cornelius Lipp, 2021. "Golfing with Trump. Social capital, decline, inequality, and the rise of populism in the US," Cambridge Journal of Regions, Economy and Society, Cambridge Political Economy Society, vol. 14(3), pages 457-481.
    6. Simon Hartmann & Thomas Lindner & Jakob Müllner & Jonas Puck, 2022. "Beyond the nation-state: Anchoring supranational institutions in international business research," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 53(6), pages 1282-1306, August.
    7. Tiina Ritvala & Rebecca Piekkari, 2021. "Geopolitics of the knowledge-based economy," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 52(2), pages 334-337, March.
    8. Klaus E. Meyer & Chengguang Li & Andreas P. J. Schotter, 0. "Managing the MNE subsidiary: Advancing a multi-level and dynamic research agenda," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 0, pages 1-39.
    9. Boarini, Romina & Causa, Orsetta & Fleurbaey, Marc & Grimalda, Gianluca & Woolard, Ingrid, 2018. "Reducing inequalities and strengthening social cohesion through inclusive growth: A roadmap for action," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 12, pages 1-26.
    10. Andrés Rodríguez-Pose & Javier Terrero-Davila & Neil Lee, 2023. "Left-Behind vs. Unequal Places: Interpersonal Inequality, Economic Decline, and the Rise of Populism in the US and Europe," LIS Working papers 859, LIS Cross-National Data Center in Luxembourg.
    11. Victor Ginsburgh & Sergio Perelman & Pierre Pestieau, 2021. "Populism and Social Polarization in European Democracies [Bien-Être et Vote]," CESifo Economic Studies, CESifo Group, vol. 67(4), pages 371-404.
    12. Barone, Guglielmo & Kreuter, Helena, 2021. "Low-wage import competition and populist backlash: The case of Italy," European Journal of Political Economy, Elsevier, vol. 67(C).
    13. repec:irs:cepswp:2024-01 is not listed on IDEAS
    14. Simona Iammarino, 2018. "FDI and regional development policy," Journal of International Business Policy, Palgrave Macmillan, vol. 1(3), pages 157-183, December.
    15. Andreas Bergh & Anders Kärnä, 2021. "Globalization and populism in Europe," Public Choice, Springer, vol. 189(1), pages 51-70, October.
    16. Karakas, Leyla D. & Mitra, Devashish, 2020. "Inequality, redistribution and the rise of outsider candidates," Games and Economic Behavior, Elsevier, vol. 124(C), pages 1-16.
    17. Rawi Abdelal, 2020. "Dignity, Inequality, and the Populist Backlash: Lessons from America and Europe for a Sustainable Globalization," Global Policy, London School of Economics and Political Science, vol. 11(4), pages 492-500, September.
    18. Eugenio Levi & Isabelle Sin & Steven Stillman, 2021. "Understanding the Origins of Populist Political Parties and the Role of External Shocks," Working Papers 21_09, Motu Economic and Public Policy Research.
    19. Daria Denti, 2022. "Looking ahead in anger: The effects of foreign migration on youth resentment in England," Journal of Regional Science, Wiley Blackwell, vol. 62(2), pages 578-603, March.
    20. Eugenio Levi & Isabelle Sin & Steven Stillman, 2024. "The lasting impact of external shocks on political opinions and populist voting," Economic Inquiry, Western Economic Association International, vol. 62(1), pages 349-374, January.
    21. Benjamin Monnery & Alexandre Chirat, 2024. "Trust in the Fight Against Political Corruption: A Survey Experiment among Citizens and Experts," Working Papers AFED 24-02, Association Francaise d'Economie du Droit (AFED).

    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:gam:jworld:v:6:y:2025:i:2:p:70-:d:1659639. 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: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    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.