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Diffusion of the internet : a cross-country analysis

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  • Andres, Luis
  • Cuberes, David
  • Diouf, Mame Astou
  • Serebrisky, Tomas

Abstract

This paper analyzes the process of Internet diffusion across the world using a panel of 199 countries during 1990-2004. The authors group countries in two categories-low and high-income countries-and show that the Internet diffusion process is well characterized by an S-shape curve for both groups. Low-income countries display a steeper diffusion curve that is equivalent to a right shift of the diffusion curve for high-income countries. The estimated diffusion curves provide evidence of a"catching-up"process, although a very slow one. The paper explores the determinants of Internet diffusion at the country level and across the same income groups. The most novel finding is that network effects seem to be crucial-the number of Internet users in a country in a given year is positively associated with the number of users in the previous year. The findings also show that the degree of competition in the provision of Internet service contributes positively to its diffusion, and there are significant positive language externalities.

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Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 4420.

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Date of creation: 01 Dec 2007
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Handle: RePEc:wbk:wbrwps:4420

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Related research

Keywords: Technology Industry; Information Security&Privacy; E-Business; Income; Education for the Knowledge Economy;

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References

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  1. Goolsbee, Austan & Klenow, Peter J, 2002. "Evidence on Learning and Network Externalities in the Diffusion of Home Computers," Journal of Law and Economics, University of Chicago Press, vol. 45(2), pages 317-43, October.
  2. Caselli, Francesco & Coleman II, Wilbur John, 2001. "Cross-Country Technology Diffusion: The Case of Computers," CEPR Discussion Papers 2744, C.E.P.R. Discussion Papers.
  3. Chinn, Menzie David & Fairlie, Robert W, 2004. "The Determinants of the Global Digital Divide: A Cross-Country Analysis of Computer and Internet Penetration," Santa Cruz Department of Economics, Working Paper Series qt76x9876q, Department of Economics, UC Santa Cruz.
  4. Chong, Alberto & Micco, Alejandro, 2003. "The Internet and the ability to innovate in Latin America," Emerging Markets Review, Elsevier, vol. 4(1), pages 53-72, March.
  5. Dasgupta, Susmita & Lall, Somik & Wheeler, David, 2001. "Policy reform, economic growth, and the digital divide - an econometric analysis," Policy Research Working Paper Series 2567, The World Bank.
  6. Wolfgang Keller, 2001. "International Technology Diffusion," NBER Working Papers 8573, National Bureau of Economic Research, Inc.
  7. Estache, Antonio & Manacorda, Marco & Valletti, Tommaso M., 2002. "Telecommunication reforms, access regulation, and Internet adoption in Latin America," Policy Research Working Paper Series 2802, The World Bank.
  8. Diego Comin & Bart Hobijn, 2003. "Cross-country technology adoption: making the theories face the facts," Staff Reports 169, Federal Reserve Bank of New York.
  9. Oecd, 2001. "Understanding the Digital Divide," OECD Digital Economy Papers 49, OECD Publishing.
  10. Robert J. Barro & Xavier Sala-i-Martin, 1995. "Technological Diffusion, Convergence, and Growth," NBER Working Papers 5151, National Bureau of Economic Research, Inc.
  11. Lars-Hendrik Roller & Leonard Waverman, 2001. "Telecommunications Infrastructure and Economic Development: A Simultaneous Approach," American Economic Review, American Economic Association, vol. 91(4), pages 909-923, September.
  12. Blanca Sanchez-Robles, 1998. "Infrastructure Investment And Growth: Some Empirical Evidence," Contemporary Economic Policy, Western Economic Association International, vol. 16(1), pages 98-108, 01.
  13. Wallsten, Scott, 2005. "Regulation and Internet Use in Developing Countries," Economic Development and Cultural Change, University of Chicago Press, vol. 53(2), pages 501-23, January.
  14. De Long, J Bradford, 1988. "Productivity Growth, Convergence, and Welfare: Comment," American Economic Review, American Economic Association, vol. 78(5), pages 1138-54, December.
  15. Gort, Michael & Klepper, Steven, 1982. "Time Paths in the Diffusion of Product Innovations," Economic Journal, Royal Economic Society, vol. 92(367), pages 630-53, September.
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