ICTs and Effectiveness of Governance: A Cross-Country Study

Abstract

This paper investigates the impact of innovations in ICTs on the effectiveness of governance using cross-country unbalanced panel data for the period from 1996 to 2017. With the ability of information storing, sharing and automation, ICT innovation can improve governance by enriching the governmental information infrastructure, presenting opportunities for better decision-making, encouraging pro-active government-citizen interaction and increasing public accountability. At the same time, the increasing trend of the digital divide, cyber-crime, loss of privacy, unemployment and inequality put pressure on the ability of a state to govern effectively. The resultant effect of ICTs on the effectiveness of governance depends on the relative strength of the two forces. We find that improvement in ICT leads to a rise in the effectiveness of governance and control corruptions subject to the efficacy of the judicial system and the rule of law, and the presence of a better rule of law strengthens the favourable impact of ICT on governance.