FDI and ICT effects on productivity growth in Middle East countries

Economic growth theories predict that economic growth is driven by investments in Information and Communication Technology (ICT). In this paper we studied the effects stemming from Foreign Direct Investment (FDI) and Information and Communication Technologies (ICT) on productivity growth. The analysis is based on panel data covering Middle East countries during the period 1990–2010. The growth accounting results indicate that the growth contribution of ICT and FDI was quite low this countries. The econometric results showed a positive and significant impact of ICT and FDI in these countries. Keywords: FDI, ICT, growth, productivity, economic development