The Impact of ICT Investment and Diffusion on Economic Growth: Empirical Evidence from Rwanda

Roger Mugabe, Liu Shulin and Byringiro Enock
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Roger Mugabe: School of Economics, Wuhan University of Technology, Wuhan, China
Liu Shulin: School of Economics, Wuhan University of Technology, Wuhan, China
Byringiro Enock: School of Economics and Business studies, Kigali Independent University ULK, Kigali, Rwanda

International Journal of Innovation and Economic Development, 2021, vol. 7, issue 4, 23-36

Abstract: This study evaluates the influence of Information and Communication Technologies (ICT) investment and diffusion on Rwanda’s economic growth. At the level we recommend, ICT imports greatly improve intermediate inputs to capital goods, resulting in increased economic growth. We use the most recent available data on technical innovation and investment for our empirical study, which spans the years 2005Q1 to 2020Q4. The results of regression analysis show that ICT development has little effect on Rwanda’s economic growth. However, we notice a patchwork of information on ICT investment. We utilize ICT goods exports and imports as a proxy for ICT investment, based on previous research. Surprisingly, ICT goods exports have had no impact on Rwanda’s economic growth. We do notice, however, that a 1% increase in ICT goods imports boosts economic growth by 3.9 percent. At this level, ICT goods import greatly boost the intermediate input to capital goods, resulting in increased economic growth. As a result, officials should ensure that ICT goods imports should be prioritized through supporting ICT investment to boost economic growth.

Keywords: ICT investment; ICT diffusion; Economic growth; Rwanda (search for similar items in EconPapers)
JEL-codes: M00 (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:mgs:ijoied:v:7:y:2021:i:4:p:23-36

DOI: 10.18775/ijied.1849-7551-7020.2015.74.2002

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