DOES ICT SPUR POVERTY REDUCTION IN SOUTH AFRICA: AN EMPIRICAL INVESTIGATION
Mercy T. MUSAKWA1, Nicholas M. ODHIAMBO2
1,2University of South Africa (Economics Department, College of Economic & Management Science, Pretoria, South Africa)
odhianm@unisa.ac.za / nmbaya99@yahoo.com
Abstract: This study examines the asymmetric impact of ICT on poverty reduction in South Africa using the NARDL approach. The study was motivated by the simultaneous existence of high poverty levels alongside increased government support for ICT adoption as a means to leverage economic development. The main objective of this study is to examine whether ICT can be a panacea for poverty alleviation in South Africa. Using annual time-series data from 1983 to 2021, the study found that positive changes in ICT are associated with poverty reduction in both the short and long run. However, negative changes in ICT were found to have no significant impact on poverty reduction. The results were corroborated by the dynamic multiplier graph, which showed that positive ICT shocks have a stronger and more sustained impact on poverty reduction compared to negative shocks.
Keywords: poverty reduction; information; communication and technology (ICT), South Africa; non-linear autoregressive distributed lag (NARDL)
JEL Classification: I32; I38; O330
