Search

This paper examines the linkages between the development of telecommunications infrastructure (DTI), economic growth, and four key indicators of operation of a modern economy: gross capital formation, foreign direct investment inflows, urbanization rates, and trade openness. By studying the G-20 countries over the period 1991-2012 and employing a panel vector auto-regressive model for detecting Granger causality, we find a network of long-run causal connections between these variables, including bidirectional causality between DTI and economic growth.

The paper examines the long-run relationship between banking sector development, stock market development and economic growth in 26 ASEAN regional forum (ARF) countries for the period 1961–2012. Using principal component analysis for the construction of development indices and panel vector auto-regressive model for testing the Granger causalities, the study shows that a long-run relationship between banking sector development, stock market development and economic growth exists in ARF countries. The study also uniquely finds the existence of bidirectional causality between banking sector development and economic growth and a unidirectional causality from stock market development to economic growth. It, however, reveals the existence of unidirectional or bidirectional causal links between banking sector development and stock market development. Hence, future studies on economic growth that exclude the dynamic interrelationship of these variables will be unreliable.

The paper investigates the link between telecommunication infrastructure and economic growth in 34 OECD countries during the period 1961–2011. Using Granger causality test, the results suggest that telecommunication infrastructure is caused by, but does not cause, economic growth. The policy implication of this study is that if policymakers want to promote telecommunication infrastructure, the attention should be on long run policies on sustainable economic growth. Furthermore, telecommunication infrastructure should be used effectively to bring more economic growth in the economy.

The paper investigates the causal relationships between penetration rate, an indicator of telecommunications development, and economic growth of 34 OECD countries during the period 1960–2010. The panel model is used in this study. Based on the panel cointegration test results, is found that penetration rate has a long run relationship with economic growth. Moreover, there is also a bidirectional Granger causality between penetration rate and economic growth in both the short run and long run. The results of this study show clearly that telecommunications development plays an important role in the economic growth of the OECD countries. Furthermore, these results can reinforce the importance of economic growth for the continued development and use of various telecommunications services in those countries.