Impact of Information and Communication Technology, Financial Development, and Trade on Economic Growth: Empirical Analysis on N11 Countries

In the modern era of globalization, information and communication technology (ICT) are the main sectors that stimulate economic development. It enables technical developments in global communication, manufacturing techniques, and contributes in the economic growth. Many economic activities, including international trade and foreign direct investment (FDI), primarily depend on various modern ICT approaches. This study aims to analyze the dynamic relationship between FDI, ICT, international trade, and economic growth in the context of N11 countries from 2000 to 2018. The study expanded an innovative ICT index containing fixed telephone lines, handheld wireless access, and internet penetration as relevant media for dispersion. We use the pooled mean group estimator on a dynamic panel (ARDL) model for conducting a robust analysis of the subject matter. We find that ICT expansion has a significant negative effect on economic growth in the long run in N11 countries. In addition, the results suggest that financial development slows down economic growth in the short and long run. Foreign direct investment and trade indicate a positive and significant relationship with economic growth in the long run.