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Threshold Analysis of ICT Infrastructure’s Effectiveness in Stimulating Sectoral Growth in Sub-Saharan Africa

Author

Listed:
  • Oshinowo Bamidele Olaitaan

    (PhD Student, Department of Economics, Olabisi Onabanjo University, Ago-Iwoye, Nigeria)

  • Maku Olukayode Emmanuel

    (Professor, Department of Economics, Olabisi Onabanjo University, Ago-Iwoye, Nigeria)

  • Ogede Jimoh Sina

    (Lecturer, Department of Economics, Olabisi Onabanjo University, Ago-Iwoye, Nigeria)

Abstract

Over the past two decades, Sub-Saharan Africa (SSA) has witnessed substantial investments in Information and Communication Technology (ICT) infrastructure. However, the anticipated uniform growth across economic sectors has not materialized, indicating the existence of threshold effects. Hence, this study explores the threshold effects of ICT infrastructure on sectoral growth across twenty-six (26) SSA countries from 1991 to 2022, using dynamic panel threshold regression methods. The findings reveal that in agriculture, ICT indicators such as mobile subscriptions (3.55%), fixed-line subscriptions (2.97%), and composite infrastructure levels (-0.897%) have insignificant impact below their respective thresholds but significantly enhance growth when these thresholds are surpassed, largely due to improved labour participation and foreign direct investment. In the industrial sector, meaningful growth effects emerge only after ICT usage (4.221%) and mobile subscriptions (41.68%) exceed identified thresholds, with labour input further enhancing productivity. For the services sector, mobile penetration (77.26%) supports growth below the threshold, but yields diminish above it— though partially offset by labour efficiency improvements. These results demonstrate the need for targeted ICT investments that reflect sector-specific conditions. The study highlights the importance of reaching critical ICT thresholds to unlock growth, recommending that ICT infrastructure planning in SSA should be aligned with sectoral characteristics and broader economic strategies to maximize development outcomes.

Suggested Citation

  • Oshinowo Bamidele Olaitaan & Maku Olukayode Emmanuel & Ogede Jimoh Sina, 2025. "Threshold Analysis of ICT Infrastructure’s Effectiveness in Stimulating Sectoral Growth in Sub-Saharan Africa," Timisoara Journal of Economics and Business, Sciendo, vol. 18(2), pages 161-186.
    • Handle: RePEc:vrs:timjeb:v:18:y:2025:i:2:p:161-186:n:1002
    DOI: 10.2478/tjeb-2025-0008
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    JEL classification:

    • C82 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Macroeconomic Data; Data Access
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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