The Impact of ICT Capital Services on Economic Growth and Energy Efficiency in China

Abstract

This study aims to investigate the impact of ICT capital services on economic growth and energy efficiency in China at both national and industrial levels during the period 2000–2020. To achieve this aim, this study introduces a measurement method for capital services, explores ICT’s contributions to economic growth, and analyzes the impact of ICT on energy efficiency. The empirical results of this study indicate that although the ICT capital services scale is relatively small, accounting for only 8.87% of the total in 2020, its growth rate is faster than that of non-ICT capital services, and the distribution of ICT capital services varies widely among different industries. Additionally, based on the economic growth decomposition framework, this study finds that the contribution of ICT capital services to economic growth is 6.95% on average. It is significantly higher in certain industries, such as Financial industry; Information transmission, software and information technology services; Construction; and Manufacturing compared to others. The total factor energy efficiency (TFEE) reveals that industries with higher energy consumption have lower energy efficiency, while the panel regression model illustrates that the development of ICT has a positive impact on improving energy efficiency, with variability across industries. Overall, the findings of this study provide crucial scientific evidence and policy implications for promoting the development of ICT and integrating it with various industries, which can significantly contribute to boosting economic growth and energy efficiency.