Journal of Applied Economic Research
ISSN 2712-7435
Digital Technology and Trade Performance in Sub-Saharan Africa
Saka Jimoh Olakunle
Lagos State University, Lagos, Nigeria
Abstract
This study examines the relationship between digital technology and trade performance with a focus on export trade in sub-Saharan African countries. The main objectives are to examine the impact digital technology measured by ICT goods import, internet use and mobile telephone subscriptions have on export trade in Sub-Saharan Africa (SSA), to evaluate the link between the degree of the region’s development and export trade and the form of digital technology most suitable in facilitating trade in the region. The study hypotheses are that: (1) ICT goods import, internet use and mobile telephone subscriptions do not influence significantly export trade in SSA; (2) the region’s development does not link appreciably to export trade in SSA; (3) no form of digital technology can facilitate trade in the region. The panel regression estimation technique is adopted considering the panel least squares, fixed effect and random effect estimation techniques. Results show that information and communication technology imports exert greater positive and significant impact on export trade flows compared to internet usage demonstrating theoretical and practical relevance of technology in trade flows. The degree of development is low and does not show an appreciable impact on trade flows in the region indicating that trade integration can thrive better in a well-structured economy. Redundant fixed effect test confirms that the panel least squares estimation is better compared to the fixed effect estimation. Hausman test demonstrates that random effect estimation is also better than fixed effect estimation. In attaining the reality of the contribution of digitalization process in SSA, policy makers need to pursue major goals that would address problems hampering its success.
Keywords
digital technology; trade; panel least squares; fixed effect; random effect.
JEL classification
F10, N7, O3, O31, O32, O33References
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Acknowledgements
I am thankful to the World Development Indicators, an official data site, from where the data employed for this research was collected.
About Authors
PhD, Associate Professor of Economics, Department of Economics, Lagos State University, Lagos, Nigeria (Badagry expressway, Ojo, Lagos, P.O BOX 0001, LASU Post Office P.M.B 1087, Apapa,); ORCID orcid.org/0000-0003-1905-7114 e-mail: jaystatistics@yahoo.com
For citation
Olakunle, S.J. (2023). Digital Technology and Trade Performance in Sub-Saharan Africa. Journal of Applied Economic Research, Vol. 22, No. 3, 480-496. https://doi.org/10.15826/vestnik.2023.22.3.020
Article info
Received March 27, 2023; Revised June 8, 2023; Accepted August 3, 2023.
DOI: https://doi.org/10.15826/vestnik.2023.22.3.020
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