Telecommunications and economic development in Singapore

Abstract

The existing research of aggregate statistical analysis on the relationship between telecommunications and economic development is largely organized around the hypothesis that telephone growth fosters economic development. Although considerable evidence supports that hypothesis, there is also a growing realization that the growth of telecommunications, in turn, requires a sound economy. The existing research, however, ignores the reciprocal relationship between these two variables. Employing Singapore data, this article formulates a simultaneous equation model to assess the reciprocal relationship between telecommunications and economic development. These data support the reciprocal relationship hypothesis. Policy implications of the findings are also discussed. © 1985.