ICT Adoption and Productivity in Developing Countries: New Firm Level Evidence from Brazil and India
AbstractThis paper uses a unique new data set on nearly a thousand manufacturing firms in Brazil and India to investigate the determinants of ICT adoption and its impact on performance in both countries. The descriptive evidence shows that Brazilian firms on average use ICT more intensively than their Indian counterparts but changes over time have been rather similar in both places. Within countries ICT intensity is strongly related to size, ownership structure, share of administrative workers and education. The econometric evidence documents a strong relationship between ICT capital and productivity in both countries, even after controlling for several other factors, including firm-specific fixed-effects. The rate of return of ICT investment seems to be much larger than usually found in more developed countries. Specific types of organisational changes matter for the return of ICT, but only for high adopters. Firms report several constraints to ICT investment in both countries and power disruption seems to significantly depress adoption and returns to ICT expenditures in India. This may be indicative of the impact of a cluster of poor institutions and/or infrastructure on performance.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 2294.
Length: 48 pages
Date of creation: Sep 2006
Date of revision:
Contact details of provider:
Postal: IZA, P.O. Box 7240, D-53072 Bonn, Germany
Phone: +49 228 3894 223
Fax: +49 228 3894 180
Web page: http://www.iza.org
Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany
Other versions of this item:
- Basant, R. & Commander, S. & Harrison, R. & Menezes Filho, N. A., 2007. "ICT adoption and productivity in developing countries: new firm level evidence from Brazil and India," Insper Working Papers wpe_70, Insper Working Paper, Insper Instituto de Ensino e Pesquisa.
- J2 - Labor and Demographic Economics - - Demand and Supply of Labor
- E20 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - General (includes Measurement and Data)
- L20 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - General
- L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
- O33 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
This paper has been announced in the following NEP Reports:
- NEP-ALL-2006-09-23 (All new papers)
- NEP-CWA-2006-09-23 (Central & Western Asia)
- NEP-EDU-2006-09-23 (Education)
- NEP-EFF-2006-09-23 (Efficiency & Productivity)
- NEP-ICT-2006-09-23 (Information & Communication Technologies)
- NEP-INO-2006-09-23 (Innovation)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Stephen D. Oliner & Daniel E. Sichel, 2000.
"The resurgence of growth in the late 1990s: is information technology the story?,"
Federal Reserve Bank of San Francisco.
- Stephen D. Oliner & Daniel E. Sichel, 2000. "The Resurgence of Growth in the Late 1990s: Is Information Technology the Story?," Journal of Economic Perspectives, American Economic Association, vol. 14(4), pages 3-22, Fall.
- Stephen D. Oliner & Daniel E. Sichel, 2000. "The resurgence of growth in the late 1990s: is information technology the story?," Finance and Economics Discussion Series 2000-20, Board of Governors of the Federal Reserve System (U.S.).
- Erik Brynjolfsson & Lorin M. Hitt, 2003.
"Computing Productivity: Firm-Level Evidence,"
The Review of Economics and Statistics,
MIT Press, vol. 85(4), pages 793-808, November.
- Geroski, P. A., 2000.
"Models of technology diffusion,"
Elsevier, vol. 29(4-5), pages 603-625, April.
- Kevin J. Stiroh, 2002.
"Information Technology and the U.S. Productivity Revival: What Do the Industry Data Say?,"
American Economic Review,
American Economic Association, vol. 92(5), pages 1559-1576, December.
- Kevin J. Stiroh, 2001. "Information technology and the U.S. productivity revival: what do the industry data say?," Staff Reports 115, Federal Reserve Bank of New York.
- Erik Brynjolfsson & Lorin M. Hitt, 2000. "Beyond Computation: Information Technology, Organizational Transformation and Business Performance," Journal of Economic Perspectives, American Economic Association, vol. 14(4), pages 23-48, Fall.
- Dale W. Jorgenson, 2001. "Information Technology and the U.S. Economy," American Economic Review, American Economic Association, vol. 91(1), pages 1-32, March.
- World Bank, 2008. "Harnessing Competitiveness for Stronger Inclusive Growth : Bangladesh Second Investment Climate Assessment," World Bank Other Operational Studies 8025, The World Bank.
- Ricardo Monge-González & Juan Antonio Rodríguez-Álvarez & John Hewitt & Keynor Ruiz & Jeffrey Orozco, 2012. "Internet Diffusion, Innovation and Employment Growth in the Costa Rican Manufacturing Sector," IDB Publications 71298, Inter-American Development Bank.
- Ricardo Monge-González & Juan Antonio Rodríguez-Álvarez & John Hewitt & Jeffrey Orozco & Keynor Ruiz, 2011. "Innovation and Employment Growth in Costa Rica: A Firm-level Analysis," IDB Publications 54278, Inter-American Development Bank.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak).
If references are entirely missing, you can add them using this form.