Does it hurt or help? Revisiting the effects of ICT on economic growth and energy consumption: A nonlinear panel ARDL approach

In this paper, we investigate the effects of information and communication technology (ICT) on economic growth and energy consumption for a panel of 27 countries ranked top of the ICT Development Index, from 1990 to 2019. By employing the panel nonlinear autoregressive distributed lag (NARDL) model approach, we confirm the presence of a long-run asymmetric effect of ICT on economic growth and energy consumption. Specifically, negative changes (reduction) in the adoption and usage of ICT can have severe consequences on economic growth in these 27 countries in the long-run, erasing all previous gains from positive ICT changes. Additionally, positive or negative shocks to ICT in these countries increase energy consumption, indicating the rebound effect exists in these countries. Finally, the results also reveal that, while the economic growth in these countries is dependent on energy consumption in the short-run, it is energy independent in the long-run. Several important policy implications are drawn.(c) 2023 Economic Society of Australia, Queensland. Published by Elsevier B.V. All rights reserved.

Automated summary

This paper investigates the effects of ICT on economic growth and energy consumption for 27 countries with high ICT development index rankings from 1990 to 2019. The panel NARDL model approach confirms a long-run asymmetric effect of ICT on economic growth and energy consumption. Negative changes in ICT adoption and usage can have severe consequences on economic growth, while positive or negative shocks to ICT increase energy consumption, indicating the rebound effect. The findings also reveal that economic growth in these countries is energy dependent in the short-run but energy independent in the long-run. Several important policy implications are drawn.