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The Impact of Digital Infrastructure on African Development

Article image

César Calderón, Catalina Cantú

01 November 2021

World Bank Group

English

Lucille Tetley-Brown

Policy brief

SmartCity.ZA

Africa

This paper estimates the impact of digital infrastructure on economic growth and its sources. The analysis uses system generalized method of moments and finds evidence of a causal impact from the digital infrastructure variables to economic growth, its sources, income inequality, and poverty.

 

The findings show that mobile connections have an impact on economic growth through the total factor productivity growth channel, while internet users drive it by the capital accumulation channel. Connections have a negative effect on the Gini coefficient, and internet users have a negative effect on the poverty headcount. The analysis also finds that human capital and access to electricity are important complementarities for digital infrastructure to reap benefits. There would be large economic gains if Africa were to close the digital infrastructure gap relative to other regions, yet there are some issues of affordability and skills that need to be addressed to reduce the usage gap and the digital divide across gender, rural-urban, and firm size.

 

Abstract based directly on original source. Back to the SmartCity.ZA collection.

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Built environment

Construction

Development

Digital access

Economic conditions

Economic development

Ethiopia

Governance

ICT

Infrastructure

Livelihoods

Mali

Niger

Nigeria

Policy

Smart Cities

Sudan

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