Conference Paper
Advancing Economic Freedom Through Digital Government in the MENA Region: An Analysis of Institutional and Macroeconomic Factors
No.
ERF_31_MIC37
Publisher
ERF
Date
March, 2025
Topic
D. Microeconomics
This study analyzes the impact of digital government on economic freedom in the MENA region, within a context of institutional and macroeconomic factors. It covers a panel dataset of 16 MENA countries over the period 1995-2023. It uses the fixed effect estimation model. The findings show a positive significant impact of digital government on economic freedom, highlighting the transformative spillover of digital governments on the conditionalities of a sound business environment. This is coupled with a non-linear positive impact of good governance practices, measured holistically, resembling diminishing returns after a certain threshold. The macroeconomic framework, represented by the Gross Domestic Product (GDP) growth, low inflation rates, and stable real exchange rates are also essential contributors to better economic freedom. The findings also show an unconventionally negative impact of FDI on economic freedom, signaling challenges related to inadequate institutional frameworks of weak absorptive capacity. This study showcases the need for reforms addressing structural disparities and the digital divide in the MENA region, providing policymakers with insights to improve the resilience of economic freedom in the area.
Authors
Amale El Maiss
Lecturer, Lebanese American University
Authors
Ola Sidani
Economic Expert, Presidency of the Council of...