Information and Communication Technology, Investment, and Economic Growth in Tajikistan: An Endogenous Growth Perspective

Abstract

This study examines the relationship between information and communication technology and economic growth in Tajikistan, with particular emphasis on the distinction between long-run and short-run dynamics. Our study conceptualizes information and communication technology as a knowledge-enhancing and productivity-enhancing input that can support technological diffusion, innovation, information exchange, and more efficient utilization of productive resources. Annual time-series data covering 1998–2025 are employed, with economic growth measured by gross domestic product growth and information and communication technology represented by a composite index incorporating access, usage, and skills dimensions. Gross fixed capital formation, foreign direct investment, labor force, trade openness, and inflation are included as additional explanatory variables. The analysis employs Augmented Dickey-Fuller and Phillips-Perron unit root tests, followed by the Autoregressive Distributed Lag bounds-testing approach to examine long-run cointegration and short-run adjustment dynamics. The results establish a long-run relationship among economic growth and the explanatory variables. Information and communication technology exhibits a positive and statistically significant association with economic growth in the long run and remains positive and significant in the short run, including through its lagged change. Foreign direct investment, labor force, and gross fixed capital formation are positively associated with long-run economic growth, while trade openness exhibits a positive but weaker relationship. Inflation displays contrasting effects across time horizons, with a positive long-run association but a negative short-run relationship. In the short run, trade openness and foreign direct investment are positively associated with economic growth, whereas changes in labor force and gross fixed capital formation exhibit negative relationships. The significant error-correction term confirms adjustment toward the long-run equilibrium following short-run disturbances. The findings highlight the importance of digital infrastructure, technological capabilities, productive investment, international capital, and workforce development in supporting economic growth in Tajikistan.