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The Effect of Economic Factors on Internet Diffusion in Developing Countries

Author

Listed:
  • Salmani, Behzad

    (Associate Professor of Economics, University of Tabriz)

  • Mohammadzadeh, Parviz

    (Associate Professor of Economics, University of Tabriz)

  • Zolghadr, Hamid

    (Ph.D. Student in Economics, University of Tabriz)

Abstract

The purpose of this study is to investigate the effects of selected economic variables on the internet diffusion in the developing countries. For this purpose a dynamic panel data model (GMM) has been estimated over the period 1995- 2012 and among 123 developing countries. The results show that per-capita income, the rate of urbanization, trade openness and human capital have a significant and positive effect on the internet diffusion. Moreover, the results indicate that the impact of ICT infrastructure on the internet diffusion is significant and positive. The results of a sensitivity analysis also reveal that increasing the share of the service sector of GDP increases the internet diffusion; while, an increase in the share of the agricultural sector has a negative effect on the internet diffusion.

Suggested Citation

  • Salmani, Behzad & Mohammadzadeh, Parviz & Zolghadr, Hamid, 2015. "The Effect of Economic Factors on Internet Diffusion in Developing Countries," Quarterly Journal of Applied Theories of Economics, Faculty of Economics, Management and Business, University of Tabriz, vol. 2(2), pages 81-102, September.
    • Handle: RePEc:ris:qjatoe:0013
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    Keywords

    Internet Diffusion; Economic Factors; Developing Countries; Generalized Method of Moments.;
    All these keywords.

    JEL classification:

    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries

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