An Assessment of Information & Communication Technology (ICT) and Governance Impact on Inclusive Growth in Africa and Asia

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ABSTRACT: This study examined the effects of ICT and governance on inclusive growth by focusing on selected countries in Sub-Saharan Africa and Asia, where ICT adoption and penetration were previously far behind the rest of the world, but are currently witnessing remarkable transformations. It also assessed the interaction effects of ICT and governance (institutional quality) on inclusive growth across the two regions. The study employed ordinary least squares (OLS) and fixed effect model (FEM) estimation techniques to evaluate the relationships among the variables using panel datasets from 1996 to 2022. The results revealed that the estimated coefficient of ICT is positive and statistically significant for both regions. This implies that ICT usage and penetration can enhance inclusive growth. A one percent increase in ICT provision will accelerate inclusive growth by 0. 089% in Africa and 0. 044% in Asia, respectively. This indicates that ICT penetration will contribute more to inclusive growth in Africa than in Asia. Furthermore, institutional quality has a negative and significant effect on inclusive growth in Africa, but a positive and significant impact in Asia. This suggests that Asian countries with more robust institutional quality systems can minimize widening gaps in income distribution, reduce poverty, and improve inclusive growth. In examining the interaction impact of ICT and governance on inclusive growth, the results indicate a negative and statistically insignificant effect in Africa but a positive and statistically significant effect in Asia. The insignificant negative effect for Africa suggests that institutional quality (governance) does not enhance the efficacy of ICT in promoting inclusive growth. However, the significant positive effect for Asia highlights the role of institutional quality (governance) in enabling the effective functioning of ICT to enhance and deliver the benefits of inclusive growth. Given these findings, we strongly suggest that policymakers, especially in Africa, should prioritize institutional quality and ICT innovation to ensure that economic growth translates into better living conditions for the populace. Furthermore, policymakers must adopt a multifaceted approach that integrates governance reforms, infrastructure expansion, and digital literacy programs.