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Foreign Direct Investment, Information Technology and Economic Growth Dynamics in Sub-Saharan Africa

Simplice Asongu () and Nicholas Odhiambo ()

No 19/038, Working Papers of the African Governance and Development Institute. from African Governance and Development Institute.

Abstract: The research assesses how information and communication technology (ICT) modulates the effect of foreign direct investment (FDI) on economic growth dynamics in 25 countries in Sub-Saharan Africa for the period 1980-2014. The employed economic growth dynamics areGross Domestic Product (GDP) growth, real GDP and GDP per capita while ICT is measured by mobile phone penetration and internet penetration. The empirical evidence is based on the Generalised Method of Moments. The study finds that both internet penetration and mobile phone penetration overwhelmingly modulate FDI to induce overall positive net effects on all three economic growth dynamics. Moreover, the positive net effects are consistently more apparent in internet-centric regressions compared to “mobile phone”-oriented specifications. In the light of negative interactive effects, net effects are decomposed to provide thresholds at which ICT policy variables should be complemented with other policy initiatives in order to engender favorable outcomes on economic growth dynamics. Practical and theoretical implications are discussed.

Keywords: Economic Output; Foreign Investment; Information Technology; Sub-Saharan Africa (search for similar items in EconPapers)
JEL-codes: E23 F21 F30 L96 O55 (search for similar items in EconPapers)
Pages: 31
Date: 2019-01
New Economics Papers: this item is included in nep-fdg, nep-int, nep-mac and nep-pay
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Citations: View citations in EconPapers (2) Track citations by RSS feed

Forthcoming: Telecommunications Policy

Downloads: (external link)
http://www.afridev.org/RePEc/agd/agd-wpaper/FDI-IC ... b-Saharan-Africa.pdf Revised version, 2019 (application/pdf)

Related works:
Journal Article: Foreign direct investment, information technology and economic growth dynamics in Sub-Saharan Africa (2020) Downloads
Working Paper: Foreign Direct Investment, Information Technology and Economic Growth Dynamics in Sub-Saharan Africa (2019) Downloads
Working Paper: Foreign Direct Investment, Information Technology and Economic Growth Dynamics in Sub-Saharan Africa (2019) Downloads
Working Paper: Foreign Direct Investment, Information Technology and Economic Growth Dynamics in Sub-Saharan Africa (2019) Downloads
Working Paper: Foreign Direct Investment, Information Technology and Economic Growth Dynamics in Sub-Saharan Africa (2019) Downloads
Working Paper: Foreign direct investment,information technology and economic growth dynamics in Sub-Saharan Africa (2019) Downloads
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