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Telecommunications Infrastructure and Economic Development: A Simultaneous Approach

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  • Lars-Hendrik Roller
  • Leonard Waverman

Abstract

In this paper we investigate how telecommunications infrastructure affects economic growth. We use evidence from 21 OECD countries over a 20-year period to examine the impacts that telecommunications developments may have had. We jointly estimate a micromodel for telecommunication investment with a macro production function. We find evidence of a significant positive causal link, especially when a critical mass of telecommunications infrastructure is present. Interestingly, the critical mass appears to be at a level of telecommunications infrastructure that is near universal service.

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File URL: http://www.aeaweb.org/articles.php?doi=10.1257/aer.91.4.909
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Bibliographic Info

Article provided by American Economic Association in its journal American Economic Review.

Volume (Year): 91 (2001)
Issue (Month): 4 (September)
Pages: 909-923

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Handle: RePEc:aea:aecrev:v:91:y:2001:i:4:p:909-923

Note: DOI: 10.1257/aer.91.4.909
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  1. Mankiw, N Gregory & Romer, David & Weil, David N, 1992. "A Contribution to the Empirics of Economic Growth," The Quarterly Journal of Economics, MIT Press, vol. 107(2), pages 407-37, May.
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  17. J. Bradford De Long & Lawrence H. Summers, . "How Strongly Do Developing Countries Benefit from Equipment Investment?," J. Bradford De Long's Working Papers _108, University of California at Berkeley, Economics Department.
  18. John G. Fernald, 1999. "Roads to Prosperity? Assessing the Link between Public Capital and Productivity," American Economic Review, American Economic Association, vol. 89(3), pages 619-638, June.
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