TITLE:
Do Internet and Human Capital Matter for Economic Growth in Developing Countries? Empirical Evidence from WAEMU Countries
AUTHORS:
Kuawo-Assan Johnson
KEYWORDS:
Economic Growth, Human Capital, Internet, Togo
JOURNAL NAME:
Modern Economy,
Vol.7 No.11,
September
28,
2016
ABSTRACT: In the attempt to establish
new sources of economic growth in the West African Economic and Monetary Union (WAEMU)
countries except Gunea Bissau for
sustainable growth of the region, this study aims to empirically assess the
role of internet and revisit the impact of human capital in these countries
based on panel data from 2009 to 2014. We firstly use the principal component
analysis technique to build the internet network development index and the
human capital index. Then we estimate a Cobb-Douglas function under the
neoclassical Solow model to establish the relationship between gross domestic
product and internet and human capital by using the fixed effects estimation
technique. The findings indicate that internet network development constitutes
an important pillar for economic growth in WAEMU countries at the current
prevailing economic environment. In addition, they reveal that the performance
of human capital in terms of economic growth is weak, a result which can be
attributed to the poor quality of educational systems of the union. Physical
capital is another source of economic growth of the WAEMU countries established
by this study. Policy message drawn from this study encourages strategies
aiming to strengthen internet network development in WAEMU countries.