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The Impact of ICT on East Asian Economic Growth: Panel Estimation Approach

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  • Elsadig Ahmed

    ()

  • Rahim Ridzuan

    ()

Abstract

This paper tests the impact of information and communications technology (ICT) on economic growth for ASEAN5+3 countries consisting of Malaysia, Thailand, Singapore, Indonesia, Philippines, Japan, Korea and China using panel data set from 1975 to 2006. In this paper, we investigate the impact of ICT on economic growth (GDP) based on standard production function consisting of capital (CAP) and labour (LAB) (number of employment as proxy of human capital), as independent variables. Telecommunications investment (TELINT) is used as a proxy to gauge the contribution of ICT as new independent variable to output growth in ASEAN5+3 countries. The study divided the ASEAN5+3 countries into two groups: ASEAN5 and ASEAN5+3 countries. We employ panel data set using various test such as panel unit root test, panel cointegration, Hausman test and generalised least squares method in order to detect the relationship between the dependent variable (GDP) and independent variables (CAP, LAB and TELINT) for ASEAN5+3 countries. The existence of long-run relationship between GDP and factor of production (capital, labour and telecommunications investment) is proven from the panel cointegration test for ASEAN5. Based on fixed effect for model 1 (ASEAN5) and random effect for model 2 (ASEAN5+3), the paper found out that labour, capital and telecommunications investment have positive relationship towards GDP. Thus, the study concludes that ICT has played an important role as engine of growth for sustainable development in ASEAN5 and ASEAN5+3 countries. In this context, ASEAN leader should take this opportunity from the formation of ASEAN5+3 to widen their cooperation with China, Japan and Korea throughout knowledge sharing especially in the area of ICT. Copyright Springer Science+Business Media, LLC 2013

Suggested Citation

  • Elsadig Ahmed & Rahim Ridzuan, 2013. "The Impact of ICT on East Asian Economic Growth: Panel Estimation Approach," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 4(4), pages 540-555, December.
  • Handle: RePEc:spr:jknowl:v:4:y:2013:i:4:p:540-555
    DOI: 10.1007/s13132-012-0096-5
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Elena Toader & Bogdan Narcis Firtescu & Angela Roman & Sorin Gabriel Anton, 2018. "Impact of Information and Communication Technology Infrastructure on Economic Growth: An Empirical Assessment for the EU Countries," Sustainability, MDPI, Open Access Journal, vol. 10(10), pages 1-22, October.
    2. Simplice A. Asongu & Jacinta C. Nwachukwu, 2019. "ICT, Financial Sector Development and Financial Access," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 10(2), pages 465-490, June.
    3. Simplice A. Asongu & Ndemaze Asongu, 2019. "The Role of Mobile Phones in Governance-Driven Technology Exports in Sub-Saharan Africa," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 10(2), pages 849-867, June.
    4. repec:eco:journ2:2018-06-30 is not listed on IDEAS
    5. Kais Saidi & Lobna Hassen & M. Hammami, 2015. "Econometric Analysis of the Relationship Between ICT and Economic Growth in Tunisia," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 6(4), pages 1191-1206, December.
    6. repec:spr:jknowl:v:9:y:2018:i:3:d:10.1007_s13132-016-0383-7 is not listed on IDEAS
    7. Ronald Ravinesh Kumar & Peter Josef Stauvermann & Syed Jawad Hussain Shahzad, 2017. "Can technology provide a glimmer of hope for economic growth in the midst of chaos? A case of Zimbabwe," Quality & Quantity: International Journal of Methodology, Springer, vol. 51(2), pages 919-939, March.
    8. Tony Irawan, 2013. "ICT and Economic Development:Conclusion from IO Analysis for Selected ASEAN Member States," EIIW Discussion paper disbei192, Universitätsbibliothek Wuppertal, University Library.
    9. repec:nap:nijssr:2016:p:11-15 is not listed on IDEAS
    10. Chung, Hyuk, 2018. "ICT investment-specific technological change and productivity growth in Korea: Comparison of 1996–2005 and 2006–2015," Telecommunications Policy, Elsevier, vol. 42(1), pages 78-90.

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    Keywords

    ICT; Economic growth; Panel data; ASEAN5+3;

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