Dividing or Uniting - ICT-Use and Regional Economic Growth in China

Policy makers worldwide put great emphasize on national and regional ICT development not least because it is believed to constitute a decisive factor for enhancing competitiveness and sustaining growth. And indeed a row of empirical studies suggests that ICTs have a positive impact on economic development. At the same time, Internet infrastructure and technology adoption appear to reinforce existing endowment cleavages between rich and poor countries, between urban and rural areas, and between high-skill and low-skill work. This raises the question whether ICTs can really change the game? The here presented paper seeks to render insight into this issue for the case of China. I analyse the impact of ICT use on regional economic development patterns based on Provincial panel data for the period 1998 to 2013. The empirical investigation takes into account potential direct and indirect effects as well as spatial spill over effects.