Abstract:
This paper attempts to estimate the determinants of Internet usage in South Africa in a theoretically
plausible model. The three-step Engle Yoo estimation technique is applied. The results indicate
that the number of Internet users is dependent on access to personal computers as well as real
wages and salaries. An error correction model is estimated and shocks are applied to the long
run variables. The shocks indicate that an increase in wages and salaries is necessary, but not
sufficient, for an increase in Internet access. The South African government has implemented
numerous policies to address the disparities that exist in the country concerning access to
information and communication. Policies such as personal income tax relief and skills development
play an integral part in addressing limited access to the Internet, although these policies sometimes
contradict the perceived objective.
