Determinants of digital access: a global empirical analysis

Abstract

The impact of economic freedom and income inequality on Digital Access Index (DAI) is examined using data from 118 countries. Two variables 'openness of the economy' and the 'extent of domestic credit to private sector' are used as controlled variables. Regression analysis shows that economic freedom, openness of the economy and the extent of domestic credit to the private sector have a positive impact on DAI. Furthermore, greater income inequality has a significant negative relationship with DAI. However, when countries are divided into high income, middle income and low income groups, the results are different. For low income countries, openness of the economy and the extent of domestic credit to the private sector are the only variables that are significantly positively related to DAI. In high income and middle income countries, all variables are significant with the exception of 'openness of the economy'. The paper concludes with a discussion of the policy implications of the results for IT strategists, policymakers and international development agencies.