Contribution of E-business in Economic Growth of Bahrain

We are living in an era of information and technology that have given us an upper hand in benefiting from the innovation that has been invented for a different cause. Talking about e-business one thing we all have in mind is 'the activities taking place online' in terms of buying and selling products & services, where neither the buyers nor sellers physically interact with each other, where the buyer is a consumer and the seller being the merchant processes the trade via the internet. This research analyzed how the economic growth of the country is getting impacted by e-business. For this purpose, the data from 1982 to 2018 have been extracted from data stream repository, government data bank, ministry of finance and national economy (Kingdom of Bahrain) and world bank data. As per our economic growth model, the study identified the hypotheses that consist of three variables (e-business, population growth, saving rate) that affect the most the economic growth. The current study has applied the Autoregressive Distributed Lag model for the empirical analysis, as the extracted data's stationary level was generated via the UNIT Root to test the data is stationary. The empirical results of the study concluded that e-business is significant at 1% with the beta value of 0.10, saving rate is significant at 5% with the beta value of 0.25 and population growth is significant at 10% with the beta value of 0.60. Lastly, the study strongly suggested that government spending should emphasize on technology enhancement, literacy rate as well as internet penetration, as these things mainly focus to e-business business that further boost the gross domestic product of the country.