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Digitization and Product Quality: Evidence from India

Author

Listed:
  • Lin Xiuxiu

    (Department of Economics, 1415 University of Auckland – City Campus , Sir Owen G Glenn Building, 12 Grafton Road, 1010, Auckland, New Zealand)

Abstract

This study explores the effects of digitization on product quality. Combining firm-product-level data on Indian manufacturing firms from 2001 to 2014 with a sectoral index that captures performance in Indian ICT service sectors used as inputs into manufacturing, I show that the development of ICT services, especially telecommunication service, has a positive and statistically significant effect on product quality. Mechanisms analysis indicates that the impacts of ICT development on product quality upgrading work through inducing manufacturing firms to use high-quality imported raw materials and outsource manufacturing jobs.

Suggested Citation

  • Lin Xiuxiu, 2026. "Digitization and Product Quality: Evidence from India," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 26(2), pages 679-717.
    • Handle: RePEc:bpj:bejeap:v:26:y:2026:i:2:p:679-717:n:1007
    DOI: 10.1515/bejeap-2025-0234
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    Keywords

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    JEL classification:

    • L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
    • L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology

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