article · African Development Review
ABSTRACT Building on recent economic complexity scholarship, this paper examines the contingent effects of economic complexity, ICT penetration, and human capital development on income inequality in Africa. The system Generalized Method of Moments estimator is deployed on a panel data that include 34 African countries from 1995 to 2021. The results, which are consistent with the skill‐biased technological change theory, show that economic complexity unconditionally widens income inequality in Africa. However, ICT and human capital development counteract the adverse effects and help complement economic complexity in reducing income inequality in Africa. In other words, when economic complexity is conditioned on adequate human capital and ICT, income inequality narrows. The ICT components worthy of note and required to effectively complement economic complexity in reducing income inequality are the internet and fixed broadband subscriptions. Also, human capital development indicators such as secondary and tertiary school enrollments as well as secondary and tertiary school pupil–teacher ratios are relevant to effectively complement economic complexity in reducing income inequality in Africa. Relevant policy directives are provided.
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DOI: 10.1111/1467-8268.70061
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