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Some Determinants And Mechanics Of Economic Growth In Middle-Income Countries: The Role Of Ict Infrastructure Development, Taxation And Other Macroeconomic Variables

Author

Listed:
  • RUDRA P. PRADHAN

    (Vinod Gupta School of Management, Indian Institute of Technology, Kharagpur, WB 721302, India)

  • MAK B. ARVIN

    (Department of Economics, Trent University, Peterborough, Ontario K9L 0G2, Canada)

  • MAHENDHIRAN NAIR

    (School of Business and Global Asia in the 21st Century (GA21) Research Platform, Monash University Malaysia, Jalan Lagoon Selatan - 47500, Malaysia)

  • SARA E. BENNETT

    (College of Business, University of Lynchburg, Lynchburg, VA 24501, USA)

  • SAHAR BAHMANI

    (Department of Business, University of Wisconsin-Parkside, Kenosha, Wisconsin 53144, USA)

Abstract

This study examines key factors in the economic growth of middle-income countries over the period 1970–2017. The variables considered are ICT infrastructure development, taxation revenue, government expenditure, gross capital formation, foreign direct investment, and inflation. This study considers interlinkages between the macroeconomic variables noted above. The purpose of this study is to determine: (1) if there is causality between the variables and (2) the direction of any causality. Using a panel vector error-correction model, we find both short-run and long-run relationships between the variables. In each specification, we find that ICT infrastructure development, taxation revenue and the four macroeconomic variables all stimulate economic growth in the long run. This suggests that policymakers should curate an integrated and holistic policy framework pertaining to taxation, ICT infrastructure development and other macroeconomic policies to create a vibrant national economic ecosystem that would ensure the sustained economic growth of middle-income countries.

Suggested Citation

  • Rudra P. Pradhan & Mak B. Arvin & Mahendhiran Nair & Sara E. Bennett & Sahar Bahmani, 2024. "Some Determinants And Mechanics Of Economic Growth In Middle-Income Countries: The Role Of Ict Infrastructure Development, Taxation And Other Macroeconomic Variables," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 69(01), pages 297-333, March.
    • Handle: RePEc:wsi:serxxx:v:69:y:2024:i:01:n:s0217590820500563
    DOI: 10.1142/S0217590820500563
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    Keywords

    ICT infrastructure development; taxation; economic growth; middle-income countries;
    All these keywords.

    JEL classification:

    • E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • O50 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - General

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