Relationships between telecommunications infrastructure, capital formation, and economic growth

This paper examines mutual relationships between telecommunications infrastructure, gross capital formation, and economic growth in the G-20 countries between 1961 and 2012. The countries are assessed individually, as a group of developing and developed countries within two sub-groups, and as a whole. Our results demonstrate that there is a long-run equilibrium relationship between these three variables. We arrive at this conclusion for the two sub-groups, for the G-20 as a whole, as well as for all individual countries. We then use a panel vector auto-regression model to reveal the nature of Granger causality among the three variables. As expected, the results are not uniform and are country and sample dependent.