ICT and Agricultural Development in South Africa: An Auto-Regressive Distributed Lag Approach

Simion Matsvai () and Yiseyon Sunday Hosu
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Simion Matsvai: Department of Business Management and Economics—Small-Scale Agribusiness and Rural Non-Farm Enterprise Research Niche, Faculty of Economic and Financial Sciences, Walter Sisulu University, Private Bag X1, Mthatha 5117, South Africa
Yiseyon Sunday Hosu: Department of Business Management and Economics—Small-Scale Agribusiness and Rural Non-Farm Enterprise Research Niche, Faculty of Economic and Financial Sciences, Walter Sisulu University, Private Bag X1, Mthatha 5117, South Africa

Agriculture, 2024, vol. 14, issue 8, 1-22

Abstract: The use of Information Communication Technology (ICT) forms a significant component of the Fourth Industrial Revolution (4IR). This study examined the impact of ICT on agricultural development in South Africa utilizing time series data from 1995 to 2022. Agricultural development was measured through agricultural output and agriculture total factor productivity as dependent variables. Traditional factors of production (land, labor, and capital) together with ICT variables (mobile cellphone subscriptions, Internet usage, and fixed telephone subscriptions) were used. Additional variables such as inflation, human development, access to energy and climate change were used. Data analysis was performed using the ARDL approach. The findings revealed that mobile phone subscriptions and Internet usage positively affect agricultural output and ATFP in the short and long run despite having a negative effect through the second lag in the short run. Fixed telephone subscriptions negatively affect ATFP in the long run while affecting output negatively in the short run through the first lag. Land, human development index, access to energy, and capital generally exhibited an increasing effect on both agricultural output and ATFP both in the short and long run through the various models estimated. Climate change and inflation were generally found to affect both agricultural output and ATFP negatively in the short and long run. The study concluded that ICT plays a significant role in promoting agricultural output and total factor productivity growth. Recommendations included that the South African government should promote the digitalization of the agriculture sector through the provision of ICT infrastructure that can be utilized by both smallholder farmers and large-scale agricultural producers.

Keywords: ICT; agricultural development; ARDL (search for similar items in EconPapers)
JEL-codes: Q1 Q10 Q11 Q12 Q13 Q14 Q15 Q16 Q17 Q18 (search for similar items in EconPapers)
Date: 2024
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