How does information and communication technology affect energy security? International evidence

Abstract

Using the panel data of 66 countries for the period 1996–2019, the current research explores the influences of information and communication technology (ICT) on energy security. We consider the role of financial development, human capital and technological development to explore the channels through which ICT influences energy security. Our empirical results reveal the adverse impact of ICT on energy demand and energy security. In addition, ICT mainly affects energy security through financial development and technological progress. Although human capital can significantly affect energy security, ICT cannot affect energy security through human capital channels. Furthermore, using economic risk as the threshold variable to study the link between ICT and energy security, we note that the impact of ICT on energy security is inverted U-shape with an improvement of economic risk. Specifically, ICT tends to increase the energy security in the lower stages of economic risk, while it weakens energy security reaching a certain level of said risk. In a similar vein, if financial risk is considered as the threshold variable, which is same as economic risk. Finally, the impact of ICT on energy security shows an upward trend in fluctuation with the passage of time. Our results provide policy implications to governments and future researchers.