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The Impact of Telecom Infrastructure on the Economic Growth: The Case of Oil-producing and Non-Oil Producing Arab Countries

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  • Mamoun Mohamad Matalqah

    (Department of Business Economics, The University of Jordan, Amman, Jordan,)

  • Talib Mohamed Warad

    (Department of Business Economics, The University of Jordan, Amman, Jordan)

Abstract

This study attempts to assess the impact of investment in the infrastructure of the telecommunications sector on economic growth in the Arab countries, using advanced econometric techniques, such as fully modified ordinary least squares, and panel data analysis utilizing cross sectional data covering 12 countries and a period of 20 years 1996-2015. The study finds evidence that investment in infrastructure for the telecommunications sector has a positive and significant effect on economic growth in non-oil producing countries in the long-term; it shows that a 10% increase in the number of telecom subscribers leads to an increase of 3% in real gross domestic product in these countries. The results also show that there is no impact for telecommunication on the economic growth of oil-producing countries. In light of the above findings, policy makers should pay more attention to the telecom sector in the Arab countries, and encourage investment in this sector.

Suggested Citation

  • Mamoun Mohamad Matalqah & Talib Mohamed Warad, 2017. "The Impact of Telecom Infrastructure on the Economic Growth: The Case of Oil-producing and Non-Oil Producing Arab Countries," International Journal of Economics and Financial Issues, Econjournals, vol. 7(3), pages 423-428.
    • Handle: RePEc:eco:journ1:2017-03-55
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    References listed on IDEAS

    as
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    5. Lars-Hendrik Roller & Leonard Waverman, 2001. "Telecommunications Infrastructure and Economic Development: A Simultaneous Approach," American Economic Review, American Economic Association, vol. 91(4), pages 909-923, September.
    6. Peter C. B. Phillips & Bruce E. Hansen, 1990. "Statistical Inference in Instrumental Variables Regression with I(1) Processes," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 57(1), pages 99-125.
    7. Manuel Arellano & Stephen Bond, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 58(2), pages 277-297.
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    Cited by:

    1. Muvawala, Joseph & Sebukeera, Hennery & Ssebulime, Kurayish, 2021. "Socio-economic impacts of transport infrastructure investment in Uganda: Insight from frontloading expenditure on Uganda's urban roads and highways," Research in Transportation Economics, Elsevier, vol. 88(C).

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    More about this item

    Keywords

    Telecom Infrastructure; Economic Growth; Fully Modified Ordinary Least Squares; Oil Countries; Co-integration; Arab Countries;
    All these keywords.

    JEL classification:

    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

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