Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/262082 
Year of Publication: 
2022
Series/Report no.: 
AGDI Working Paper No. WP/22/019
Publisher: 
African Governance and Development Institute (AGDI), Yaoundé
Abstract: 
Compared to other regions of the world, the potential for information technology penetration in sub-Saharan Africa (SSA) is very high. Unfortunately, productivity levels in the region are also very low. This study investigates the importance of information technology in influencing the effect of foreign direct investment (FDI) on total factor productivity (TFP) dynamics. The focus is on 25 countries in SSA. Information technology is measured with mobile phone penetration and internet penetration, while the engaged TFP productivity dynamics are TFP, real TFP, welfare TFP, and real welfare TFP. The empirical evidence is based on the Generalised Method of Moments. The findings show that, with the exception of regressions pertaining to real TFP growth for which the estimations do not pass postestimation diagnostic tests, it is apparent that information technology (i.e. mobile phone penetration and internet penetration) modulate FDI to positively influence TFP dynamics (i.e. TFP, welfare TFP, and welfare real TFP). Policy and theoretical implications are discussed.
Subjects: 
Productivity
Foreign Investment
Information Technology
Sub-Saharan Africa
JEL: 
E23
F21
F30
L96
O55
Document Type: 
Working Paper

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