Can Income Inequality be Affected by the Interaction Between ICTs and Human Capital?: The Evidence from Developing Countries

Patrick Marie Nga Ndjobo () and Nadège Ngah Otabela ()
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Patrick Marie Nga Ndjobo: University of Maroua
Nadège Ngah Otabela: University of Maroua

Journal of Quantitative Economics, 2023, vol. 21, issue 1, No 9, 235-264

Abstract: Abstract Income inequality in developing countries remains a major concern. It has been established that higher inequality makes a greater proportion of the population vulnerable to poverty. This paper aimed to analyse the effect of the interaction between ICTs and human capital on income inequality in developing countries. Covering 89 developing countries for the period 2000 to 2015 and based on panel fixed effects instrumental variables technique, this study finds that the interaction between ICTs and human capital reduces overall income inequality on the one hand, and on the other, leads to an increase in the income shares of the poorest, and in particular relative to the richest in developing countries. Furthermore, the interaction between ICTs and human capital reinforces the impact of ICTs on income inequality in developing countries. These results suggest that prioritizing the acquisition of human capital by the poorest, as well as promoting access to and use of ICTs for the benefit of the poorest would significantly contribute to reduce overall income inequality and increase income shares of the poorest in developing countries.

Keywords: ICTs; Human capital; Income inequality; Quintile income shares; Developing countries; Fixed effects instrumental variables; I24; O15; O33 (search for similar items in EconPapers)
JEL-codes: I24 O15 O33 (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (3)

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DOI: 10.1007/s40953-022-00336-5

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