The Casuses of Digital Divid and Income Divide: A Case Study of Selected Countries

The main purpose of this research is to investigate causality relationship between digital divide and income divide. Between Countries does digital divide (ICT infrastructure and access) support income divide? Or there is feedback between them? We use panel data set for 28 countries an period (2000 –2006) they have been assembled to test the Hsiao Causality. In order to, first the cross-country data concerning Gini coefficient for income divide and, Digital Opportunity Index (DOI) for digital divide and apply Hsiao Causality test. So the model is estimated applying the GLS estimation method. The results indicate that there is causality relationship between digital divide and income divide an Increase in digital opportunity support increase income inequality and by increase in the income inequality digital opportunity decreases.