Investigating Relationship between Digital Payment and Transportation using Panel ARDL

Abstract

Digitization of payment facilitate easier and faster payment which increase transactions volume in the economy that imply on more shipping of goods. The paper analyzes short and long-run dynamics deploying panel ARDL "Autoregressive Distributed Lag" approach based on specification and model examination. The study estimated three models investigating impact of digital payment on maritime and air freight transport, as well as, investigating main determinants of digital payment for the period from 2000 till 2020 for 16 countries in MENA region "Middle East and North Africa". Main results are positive significance of digital payment, internet, mobile and banking usage on transportation. Main determinants of digital payment found to be income, mobile, internet and transportation which indicate bi directional relationship between transportation and digital payment. The results recommend that digital payment should be considered in policy designing. MENA countries should enhance digital payment, and focus on intensifying access to mobile and Internet.