Template-type: ReDIF-Paper 1.0
Author-Name: Meijers, Huub
Author-Email: huub.meijers@maastrichtuniversity.nl
Author-Workplace-Name: UNU‐MERIT/MGSoG, and Department of Economics, Maastricht University
Title: Does the internet generate economic growth, international trade, or both?
Abstract: Recent cross country panel data studies find a positive impact of
	internet use on economic growth and a positive impact of internet use on
 	trade. The present study challenges the first finding by showing that
 	internet use does not explain economic growth directly in a fully
 	specified growth model. In particular openness to international trade
 	variables seems to be highly correlated with internet use and the
 	findings in the literature that internet use causes trade is confirmed
 	here, suggesting that internet use impacts trade and that trade impacts
 	economic growth. A simultaneous equations model confirms the positive
 	and significant role of internet use to openness and the importance of
 	openness to economic growth. Internet use has been shown to impact trade
 	more in non-high income countries than in high income countries, whereas
 	the impact of trade on economic growth is the same for both income
 	groups. 
Classification-JEL: C23, L86, L96, F10, O40
Keywords: economic growth, internet, ICT, trade, panel data  
Series: UNU-MERIT Working Papers
Creation-Date: 2012
Number: 050
File-URL: http://www.merit.unu.edu/publications/wppdf/2012/wp2012-050.pdf
File-Format: application/pdf
File-Size: 275 Kb
Handle: RePEc:unm:unumer:2012050