IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this article

The New Economy in Growth and Development

Listed author(s):
  • Matti Pohjola

The benefits from the New Economy should accrue as improvements in productivity and economic growth. But while the use of information and communication technology (ICT) seems to have had a substantial impact on the performance of the United States economy, the evidence for other countries is much weaker. This study does not find any significant correlation between ICT investment and economic growth in the period 1985--99 for a sample of 42 countries for which ICT spending data are available. Even more surprisingly and in contrast with some previous studies, the relationship is not statistically significant for the subsamples of industrial or high-income countries either. There are at least three possible explanations for this apparent 'productivity paradox'. The most obvious is the fact that not many countries, other than the USA, have yet invested much in ICT. The second reason is that even if they have done so, they may not have invested enough in complementary infrastructure, such as education and skills, in order to reap the benefits from ICT investment. Technology by itself is not a solution to any development problem; it only provides an opportunity. The third and the most controversial explanation is that the neoclassical method applied in assessing the benefits may not capture the most essential aspects of the New Economy or the ICT revolution. The benefits may not lie in the supply side of the economy but in the demand side. Copyright 2002, Oxford University Press.

To our knowledge, this item is not available for download. To find whether it is available, there are three options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.

Article provided by Oxford University Press in its journal Oxford Review of Economic Policy.

Volume (Year): 18 (2002)
Issue (Month): 3 ()
Pages: 380-396

in new window

Handle: RePEc:oup:oxford:v:18:y:2002:i:3:p:380-396
Contact details of provider: Web page:

No references listed on IDEAS
You can help add them by filling out this form.

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:oup:oxford:v:18:y:2002:i:3:p:380-396. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Oxford University Press)

or (Christopher F. Baum)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.