Human Capital and Growth of Information and Communication Technology-intensive Industries: Empirical Evidence from Open Economies

This paper examines the effect of human capital on the growth of information and communication technology (ICT)-intensive industries using data from a sample of open economies over the period 1980-1999. The econometric analysis suggests that value added and employment in ICT-intensive industries grew relatively faster in countries with a higher ex-ante human capital stock and in countries with a fast improvement in human capital. Further, in countries with fast human capital accumulation, labour productivity in ICT-intensive industries grew faster. The results are robust to controls for other determinants of industry growth and country characteristics affecting industry specialization and to using alternative human capital measures.