Is Inequality Harmful for Broadband Diffusion and Economic Growth?

Abstract

Some say that the digital gap adds new inequalities to the economic and social inequalities and help amplify them. However, others think that this gap is simply the effect of the existing social and economic inequalities. Although the first opinion has been studied by a fair number of empirical studies, the second has not had much luck in the existing literature. In this work, we try to examine the impact of inequality on the proliferation of broadband Internet and on the change of its relationship with economic growth. The implementation of two empirical models on panel data for 19 countries covering the 2000-2012 period identified two main original results. The positive impact of broadband on economic growth is reduced by the digital divide, which strengthened by the presence of income inequality and hampers economic growth. The second model emphasizes the blocking effect that income inequality could have on broadband proliferation. Contribution/ Originality:This study is one of very few studies which have investigated the trilateral relationship between broadband (and ICT in general) inequality and growth, and allows studying the inverse relationship between broadband and inequality (i.e. how inequality affects the broadband proliferation). INTRODUCTIONRecently, the growing internal inequalities in the world, and specifically in the advanced countries, has caused a renewed interest in the study of the impact of inequality on economic growth as well as the factors explaining this increase (

Diffusion of Innovations and Labor Market Challenges: A Multiple Case Study from Angola

“…Finally, the logic for the study and methodological support for the data collection and analysis is provided. (Aissaoui, 2017;Tayo et al, 2015;Ugur & Mitra, 2017). Other researchers have also examined the linkages between ICTs and the promotion of individual or community quality of life (Adera et al, 2014;Diga et al, 2013;Kariuki, 2015;Saidi & Douglas, 2017).…”

“…Nevertheless, scholars argue that African developing countries still register a gap in the relationship between general ICT diffusion and innovation and socioeconomic growth and development (Asongu, Biekpe, & Tchamyou, 2019;Evans, 2019;Tayo, Thompson, & Thompson, 2015;Ugur & Mitra, 2017). For some, the impact assessment of ICT adoption toward socioeconomic development is based on economic insufficiencies among categories of people and digital divides which are often defined as differences between access and use of ICT infrastructures mostly among impoverished sub-Saharan African populations (Aissaoui, 2017;Penard, Poussing, Mukoko, & Piaptie, 2015). Others reported that the rapid diffusion of technological innovations causes industrial processes (manufacturing and production) to change, which in turn alters the relationship between economic growth and development (Grabowski, 2017).…”

“…Researchers have continuously shown that social values, culture, and norms are the dynamic constructs for labor productivity and represent the fundamental source of economic development (Li, Park, & Selover, 2017). This suggests that a better understanding of the relationship between social inequality and growth should lead to a better conception of the impact of ICT diffusion of innovations on the socioeconomic development of developing countries (Aissaoui, 2017). The interplay between ethnic groups, the undervalued local knowledge in favor of foreign, and the deinstitutionalization of the traditional economic institutions has also been highlighted as one of the major obstacles to technological diffusion and economic growth in some African countries (Amavilah, 2016).…”

“…While the key aspects of human capital is knowledge and skills embodied in people, researchers suggest that skilled individuals have the advantage of accelerating productivity with technological innovations (Danquah & Amankwah-Amoah, 2017). Unskilled workers, on the other hand, are left in a disadvantageous position, causing their further disqualification, exclusion, and consequently unemployment (Aissaoui, 2017;Mutula, 2008;Oyedemi, 2012). Considering the aforementioned scenario, Kruger 2017suggested that technological progress may be biased with respect to certain production factors through cross-region, social, and technological differences that could either benefit the skilled or the unskilled worker.…”

“…This research study purposefully selected Angolan stakeholders, residing within several impoverished communities in Angola whose innovation policy initiatives to combat labor market challenges through technology diffusion continue to stall within their region. Although the participants' capacities to absorb ICTs and deal with its challenges differ at some point and may share characteristics of marginalization with other already powerful and controlling elite (Diga et al, 2013;Njoh, 2018) such as the knowledgeable and skilled in more sustainable regions (Aissaoui, 2017;Mutula, 2008;Oyedemi, 2012), the latter groups were not included in this study. The optimal case study consisted of eight Angolan stakeholders, residing within Angolan impoverished communities to ensure proper and quality data collection.…”