Work

Exploring the interactive effects of remittances, financial development and ICT in Sub-Saharan Africa: an ARDL bounds approach

Year: 2012

Type: article

Abstract: In this paper, using the ARDL bounds approach and augmented Solow framework, we explore the impacts of capital inflows (remittances, foreign direct investment and overseas development assistance) and financial-technology inclusion viz. remittance on per worker income in Sub-Saharan Africa (SSA) for the periods 1970–2010. The results show that growth in the region is lead by capital productivity. Although information and communications technology (ICT) per se has a negative effect on income, when ICT is associated with financial development and remittances, the effects are positive in both short run and long run. Thus, there is a need for greater financial and technology inclusion – linking remittance industry with financial and ICT services. Overseas development assistance (ODA) shows a negative elasticity while FDI and remittances per se is negative and not statistically significant. SSA’s predominantly ruralised economic structure further calls for greater accessibility, affordability and inclusivity of financial and ICT services linked to remittances market, development of critical, infrastructures, key sector reforms, and well managed and assessed ODA and FDI inflows for sustainable pro-growth development.

Source: African J of Economic and Sustainable Development

DOI: 10.1504/ajesd.2012.049288

Author: Ronald Ravinesh Kumar

Institution: University of the South Pacific

Language: English

Topic: Economic Growth and Development

Subfield: Information Systems

Field: Computer Science

Domain: Physical Sciences

SDGs: Decent work and economic growth, Industry, innovation and infrastructure, Reduced inequalities, No poverty

Open Access status: green

Funders: World Bank Group, Sylff Association