P-13 The Relationship Between Information and Communication Technology, Financial Development, Electricity Consumption and Economic Growth in OECD Countries: A Panel Investigation

This study investigates the relationship between information and communication technology (ICT), electricity consumption (EC), real gross domestic product per capita (GDPC) and financial development (FD) for sixteen OECD countries in a balanced framework between the periods of 1990 and 2014. This paper employs relatively new panel estimation techniques that account for heterogeneity and cross-sectional dependency in order to enable robust estimates and avoid spurious analysis. Empirical evidences reveal that there is cross-sectional dependency among the countries investigated as shown by Pesaran (2004). Thus, this current study proceeds to second generation panel econometrics techniques for reliable and consistent estimates. Pesaran (2007) panel data unit root test was employed to check for stability and asymptotic features of the data. For long-run equilibrium relationship among series, a bootstrap panel technique was utilized. Findings here have no favor for cointegration relationship among the series examined. Subsequently, this paper examined causal interaction among series via the Dumitresu & Hurlin (2012) Granger causality test. The causality test has the following revelations: A bi-directional causality running from EPC to ICT, EPC to FD, GDPC to ICT and ICT to FD. This bi-directional causality indicates to policy makers that if information and communication technology is enhanced, its multiplier effect would influence electric power consumption and the economy at large, given that there is also causality from information and communication technology to financial development