Abstract
Information and communication technology (ICT) is considered a significant factor in economic growth and development. Over the past two decades, scholars have studied the impact of ICT on economic growth, but there has been little research that has addressed the impact of ICT on human development, which is considered one of the fundamental factors of economic development. This could be especially important from the perspective of developing countries, which can develop faster through the implementation of ICT. Thus, the aim of this paper is to investigate the effects of ICT use on human development, distinguishing effects among high, upper-middle, lower-middle and low-income countries following the World Bank classification 2020. Our sample includes 130 countries in the period from 2007 to 2019. The empirical analysis is based on dynamic panel data regression analysis. We use Generalized Method of Moments (GMM) as an estimator, i.e., two-step system GMM. The results primarily support the dynamic behaviour of human development. The results of the analysis also show that ICT has highly significant positive effects on human development in lower-middle-income and low-income countries, while the effects do not appear to be significant in high- and middle-income countries. This research serves as an argument for the need to invest in ICT and its implementation in low-income countries; however, it also suggests that the story is not one-sided and that there are possible negative effects of ICT use on human development. From the perspective of economic policy, the results can be a guideline for the implementation and use of ICT in developing countries, which could lead to economic growth and development and thus better quality of life. On the other hand, policymakers in developed countries cannot rely on ICT alone; they should also consider other technological innovations that could ensure a better quality of life.
Highlights
IntroductionThe development of technology, especially information and communication technology (hereinafter: Information and communication technology (ICT)), has had significant effects on the economy and other aspects of human life in recent decades
According to the human development theory, income is only one of the elements that lead to the fulfilment of human needs; Information and communication technology (ICT) is considered to have significant effects on the fulfilment of human needs, even greater than monetary income, because it improves the overall quality of life
Due to the contradictory results offered by the current empirical literature, this paper focuses on ICT effects on human development, taking into account the countries’ level of development
Summary
The development of technology, especially information and communication technology (hereinafter: ICT), has had significant effects on the economy and other aspects of human life in recent decades. It is impossible to imagine the effective functioning of an individual, an economy, and a whole society without the use of ICT. Educational institutions, the health system, enterprises, households, and the entire world economy depend on ICT. According to the human development theory, income is only one of the elements that lead to the fulfilment of human needs; ICT is considered to have significant effects on the fulfilment of human needs, even greater than monetary income, because it improves the overall quality of life. ICT provides individuals with access to information, enables social interaction, facilitates access to education and healthcare, and creates new business opportunities. ICT is expected to have an even greater impact in the future
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