ICT and Economic Integration on Growth in ASEAN Region: Dynamic Panel GMM Approach

Muhammad Bilal Ahsin,Jerome Kueh,Muhammad Asraf Bin Abdullah

doi:10.6007/ijarbss/v11-i8/10795

Abstract

Southeast Asian Nations (ASEAN) observed rapid economic growth in the last few decades. This study aims to investigate whether economic integration and information and communication technology (ICT) promotes economic growth in ASEAN. It further examines the role of ICT for economic integration and growth relationship with respect to ICT readiness and usage. The study undertook panel data over 21 years (1997 – 2017) and employed Generalized Method of Moments approach for estimation of results. The results revealed that economic integration and ICT enhance economic growth. Moreover, enhanced ICT stimulates the impact of economic integration on economic growth. The results also confirmed a more substantial effect of ICT readiness on economic growth as compared to ICT usage.

Highlights

Economic growth enhancement is the principal objective for every economy that has been significantly contributed by international trade (Shuaibu, 2015 and Ogbuabor et al, 2019). Krugman (1979) suggested that international trade of differentiated products can be beneficial as market forces will channel resources to more productive sectors, causing efficiency enhancement
This study investigates the impact of economic integration on economic growth and explores the role of information and communication technology (ICT) for economic integration and growth relationship
The results revealed that economic integration and ICT both have significant and positive impact on economic growth

Summary

Introduction

Economic growth enhancement is the principal objective for every economy that has been significantly contributed by international trade (Shuaibu, 2015 and Ogbuabor et al, 2019). Krugman (1979) suggested that international trade of differentiated products can be beneficial as market forces will channel resources to more productive sectors, causing efficiency enhancement. Economic growth enhancement is the principal objective for every economy that has been significantly contributed by international trade (Shuaibu, 2015 and Ogbuabor et al, 2019). The increase in efficiency will further enhance total productivity and growth in the economy. Every country aims to enhance international trade, but there are specific trade barriers. Many countries unified their economic policies to eliminate trade barriers fully or partially. This consolidation and minimization of tariff and non-tariff restrictions on trade is known as economic integration (Mohanty & Pohit, 2007; Danquah et al, 2013; Heshmati, 2016; Ogbuabor et al, 2019)

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Results

Conclusion