INFORMATION AND COMMUNICATION TECHNOLOGIES AND HUMAN CAPITAL DEVELOPMENT: A PANEL DATA ANALYSIS

Abstract

In this study, panel data for 143 countries from 1993 to 2014 are used to examine the association between ICTpenetration and human capital development. Human Capital Index is utilized as a proxy for human capitaldevelopment while ICT penetration is proxied by the penetration of internet users, fixed broadband subscriptions, andmobile phones. Each ICT indicator is considered in a separate model to avoid any potential multicollinearity problems.Bivariate and multivariate fixed time effect panel data estimation results suggest that there is a positive and strongrelationship between ICT penetration and human capital development. Multivariate models are also estimated fordeveloping countries sub-sample to check the robustness of estimation results. It is be observed that estimation resultssupport the previous findings. Estimation results also indicate that individuals using the Internet as a percentage ofpopulation has the largest impact on the human capital among ICT indicators used in the study.