Abstract:
The research study evaluates the role of digitalisation on the economic growth with
special reference to low- and middle-income countries. Furthermore, the study
utilises a panel dataset comprising the results of 33 nations over the period from 2000
to 2021. The measure used to evaluate economic growth is GDP per capita, and it
serves as the proxy for economic growth. There are a variety of measures used to
gauge the effect that digitalization has on the economy. These measures include
evaluating the digitalization are fixed telephone subscriptions, mobile subscribers,
fixed broadband subscribers, and the proportion of internet users. In order to
regulate the impact of different factors on the GDP, this research incorporates a
group of macro-economic measures that includes gross fixed capital formation, trade
and labour force participation, and inflation. These macroeconomic factors also
consist of population features, public consumption, research and development
expenses. Both the static panel regression analysis and the dynamic two-step system
generalized method of moments (GMM) estimation strategy are employed to deal
with endogeneity, heterogeneity, and the dynamic nature of growth. It is found that
digitalization positively and significantly influences economic growth, and
broadband and internet access have a significant impact on economic growth.
Traditional drivers of economic growth, such as investments and the participation of
the labour force, also retain their relevance. This study has significant implications
for developing countries, and it suggests that developing the information and
communications technology sector, besides other economic means, can contribute to
economic growth.
