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Fridays Academy: Technology and Growth

Ignacio Hernandez's picture

As usual on Fridays, based on Raj Nallari and Breda Griffith's lecture notes.

 

Information and Communication Technology

Information and Communication Technology (ICT) is now the main technological driver for productivity growth in a number of developing countries. According to a study by the Centre for Economic Policy Research, a country which has reached a level of mobile phone penetration of 10 percent of the population adds 0.59 percent to its GDP per capita growth rate. Furthermore, strong empirical evidence suggests that investment in ICT improves competitiveness (see figure below).  Investment in higher education is shown to strongly boosts competitiveness, partly through allowing better use of ICT. Hence, investments in human capital and ICT are key components of recent growth performance in several developing countries.

 

The Global Competitiveness Index

                                                                                                                                                                                                                        Source: World Economic Forum 2006

 

Next Friday: We will start looking at Urbanization and Growth.