Fiscal Capacity, Digital Connectivity, and Economic Growth in Morocco: Short- and Long-Run Evidence from an ARDL Approach (2003–2023)

This study examines the short- and long-run relationships between fiscal capacity, digital connectivity, and economic growth in Morocco over the period 2003–2023, using an Autoregressive Distributed Lag (ARDL) bounds testing approach. Tax revenue as a share of GDP proxies the state’s fiscal capacity, while Internet usage captures the scale of digital connectivity; results are discussed in light of Morocco’s ongoing digital fiscal reforms, including the 2024 Finance Act. The F-Bounds test confirms a stable long-run cointegrating relationship among all variables (F = 11.838, p < 0.01). In the short run, gross fixed capital formation is positively associated with GDP per capita, while Internet usage is negatively associated with GDP per capita; tax revenue enters only through the long-run relationship, and public expenditure shows no significant short-run effect. In the long run, gross fixed capital formation retains a significant positive effect, and Internet usage remains negatively and significantly associated with GDP per capita, while tax revenue and public expenditure remain statistically insignificant at both horizons. These results suggest that, over this period, capital investment has been a more reliable driver of Morocco’s GDP per capita than digital connectivity. We propose a reinvested digital taxation framework as a forward-looking policy direction worth exploring, rather than as a conclusion directly established by these results.