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ICT and Productivity in Developing Countries: New Firm-Level Evidence from Brazil and India

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Author Info

  • Simon Commander

    (European Bank for Reconstruction and Development and IE Business School, Madrid)

  • Rupert Harrison

    (University College London)

  • Naercio Menezes-Filho

    (INSPER and University of São Paulo)

Abstract

This paper uses a unique new data set on manufacturing firms in Brazil and India to estimate production functions, augmented by information and communications technology (ICT). We find a strong positive association between ICT capital and productivity in both countries that is robust to several different specification tests. The paper also breaks new ground when using the Indian data to investigate the effect of the institutional and policy environment on ICT capital investment and productivity. We find that poorer infrastructure quality and labor market policy are associated with lower levels of ICT adoption, while poorer infrastructure is also associated with lower returns to investment. © 2011 The President and Fellows of Harvard College and the Massachusetts Institute of Technology.

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Bibliographic Info

Article provided by MIT Press in its journal Review of Economics and Statistics.

Volume (Year): 93 (2011)
Issue (Month): 2 (May)
Pages: 528-541

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Handle: RePEc:tpr:restat:v:93:y:2011:i:2:p:528-541

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Web page: http://mitpress.mit.edu/journals/

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Cited by:
  1. Barros, Henrique M. & Lazzarini, Sergio G., 2009. "Meritocracy and Innovation: Is There a Link? Empirical Evidence from Firms in Brazil," Insper Working Papers wpe_162, Insper Working Paper, Insper Instituto de Ensino e Pesquisa.
  2. Grace Kite, 2012. "The Impact of Information Technology Outsourcing on Productivity and Output: New Evidence from India," Working Papers 173, Department of Economics, SOAS, University of London, UK.
  3. Juan M. Gallego & Luis H. Gutiérrez & Sang H. Lee, . "A Firm-Level Analysis of ICT Adoption in an Emerging Economy: Evidence from the Colombian Manufacturing Industries," Development Working Papers 362, Centro Studi Luca d\'Agliano, University of Milano.
  4. Araújo, Eurilton, 2012. "Investment-specific shocks and real business cycles in emerging economies: Evidence from Brazil," Economic Modelling, Elsevier, vol. 29(3), pages 671-678.
  5. Lee, Kyeong Ho & Bellemare, Marc F., 2012. "Look who's talking: the impacts of the intrahousehold allocation of mobile phones on agricultural prices," MPRA Paper 38908, University Library of Munich, Germany.
  6. Bogaard, Hein & Svejnar, Jan, 2013. "Incentive Pay and Performance: Insider Econometrics in a Multi-Unit Firm," IZA Discussion Papers 7800, Institute for the Study of Labor (IZA).

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