Can Income Inequality be Affected by the Interaction Between ICTs and Human Capital?: The Evidence from Developing
Patrick Marie Nga Ndjobo1, Nadège Ngah Otabela2
1Department of Economic Analysis and Policy, Faculty of Economics and Management, University of Maroua, Maroua, Cameroon.
Journal of Quantitative Economics : Journal of the Indian Econometric Society
|January 23, 2023
Summary
The interaction between Information and Communication Technologies (ICTs) and human capital significantly reduces income inequality in developing nations. This synergy boosts the income share of the poorest populations, relative to the richest.
Area of Science:
- Development Economics
- Information Economics
- Socioeconomics
Background:
- Income inequality is a critical issue in developing countries, exacerbating poverty.
- Understanding the drivers of inequality is crucial for targeted policy interventions.
Purpose of the Study:
- To analyze the combined effect of Information and Communication Technologies (ICTs) and human capital on income inequality.
- To investigate how this interaction influences income distribution, particularly for the poorest segments of society.
Main Methods:
- Panel fixed effects instrumental variables technique.
- Analysis covers 89 developing countries from 2000 to 2015.
Main Results:
- The interaction between ICTs and human capital demonstrably reduces overall income inequality.
- This interaction increases the income share of the poorest populations, especially compared to the richest.
- The synergy between ICTs and human capital amplifies the impact of ICTs on income inequality.
Conclusions:
- Policies should prioritize human capital development for the poorest populations.
- Promoting access to and use of ICTs among the poorest is vital for reducing inequality.
- Strategic investment in both human capital and ICTs can significantly improve income distribution.
Keywords:
Developing countriesFixed effects instrumental variablesHuman capitalI24ICTsIncome inequalityO15O33Quintile income sharesMore Related Videos
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