Panel Data Analysis of Telecommunications and Economic Growth

This paper assesses the importance of telecommunications sector by means of investment, foreign trade volume and consumption in telecommunications field to economic growth. Acquisition of tangible and non-tangible assets or the renewal of existing ones made by organizations providing telecommunication network and services as "investment in telecommunications", World Trade Organization's classification for the "telecommunications traded commodities and services", and the number of mobile-cellular telephone subscriptions, fixed line subscriptions and number of internet users as "telecommunications consumption" are used. A dynamic panel data model is applied to measure the relationship between telecommunications sector and economic growth to 44 countries indifferent regions and at different income levels for the period 2000 to 2015. AAccording to system GMM results, there exist positive and statistically significant relationship between economic growth and investment, foreign trade volume and consumption in telecommunications, which is compatible with literature. The results also imply that economic growth in countries would be directly stimulated by foreign trade in telecommunications goods.