# ICT Adoption and Stock Market Development: Empirical Evidence Using a Panel of African Countries
## 2 Review of Related Literature
### ICT Adoption and Stock Market Development  
Measuring the relevance of ICT adoption to stock market development has become important not only for industrial and marketing purposes but also for policymakers, who should formulate effective measures to overcome the existing, and even growing, digital inequalities. Notwithstanding, extant studies have invariably examined ICT adoption, either in relation to economic growth or some other features of finance and banking development. Therefore, it will be pertinent to note that ICT has been studied relative to various aspects of human activity. An examination of the literature implies that the effects of ICT on stock market development in Africa is not yet well researched and documented. Although there is a growing strand of literature that has examined the link between ICT in relation to stock market development and performance, research that focuses on emerging countries is very limited. Amongst others, [PERSON] and [PERSON] (2003) explored the link between ICT and stock market development in emerging markets and high-income economies. The study found that personal computers and Internet hosts have strong effects on stock market development. Credit to the private sector and market capitalisation were also found to exert significant positive effects on stock market development. [PERSON] (2005) explored a historical and descriptive approach, as well as progress and prospects perspectives, to assess the possibility of remedying the situation via regional cooperation and integration of stock exchanges in eastern and southern African regions. Identifying ICT-induced diversified risks, efficiency and competition, higher returns, liquidity and cross-border capital flow as potential benefits of such networking, the study adduced that the exchanges stand to benefit more from closer cooperation by encouraging more cross-border and information/technology sharing. [PERSON] (2005) set out to investigate whether the process of communication and interaction between investors and boards of companies had an impact on stock market return by examining the actual penetration of ICT into the 'external' corporate governance of Germany's publicly listed companies. The findings suggested that stock market returns were negatively related to ICT usage. [PERSON] (2006) investigated the role of financial development in explaining ICT diffusion during the 1990-2003 period. The study documented that financial development is an important determinant of ICT development. [PERSON] et al. (2009) examined the effects of information technology on the growth and development of the capital market in Nigeria for the period 1998-2007. They found that the level of ICT-facilitated interaction between stockbrokers and investors significantly affected the growth of market capitalisation and the volume and value of shares traded. However, it was found that information technology does not significantly affect a number of listings and government bonds. Whereas [PERSON] and [PERSON] (2011) employed a sample of industrialised countries for the period 1990-2008 to analyse the effects of ICT on economic growth and documented a positive relationship. [PERSON] and [PERSON] (2011) investigated the impact of ICT on the growth of the Indian Stock Exchange and found that most of the stock market development indicators were significantly affected by ICT adoption, especially the number of stockbrokers. In a relatively more broad-based study, [PERSON] et al. (2011) employed a panel cointegration methodology to examine the dynamic relationship among financial development, ICT and GDP per capita in 86 sample countries. They found that personal computers and GDP per capita increase the liquidity, size and activity of financial systems. They also established that Internet and GDP per capita improve the liquidity, size, stock trading and activity of the financial markets. [PERSON] et al.