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

Author

Listed:
  • 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.

Suggested Citation

  • Simon Commander & Rupert Harrison & Naercio Menezes-Filho, 2011. "ICT and Productivity in Developing Countries: New Firm-Level Evidence from Brazil and India," The Review of Economics and Statistics, MIT Press, vol. 93(2), pages 528-541, May.
  • Handle: RePEc:tpr:restat:v:93:y:2011:i:2:p:528-541
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    Citations

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    Cited by:

    1. Massa, Isabella, 2015. "Technological change in developing countries: Trade-offs between economic, social, and environmental sustainability," MERIT Working Papers 051, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    2. Humphrey M. Sabi & Faith-Michael E. Uzoka & Kehbuma Langmia & Felix N. Njeh & Clive K. Tsuma, 0. "A cross-country model of contextual factors impacting cloud computing adoption at universities in sub-Saharan Africa," Information Systems Frontiers, Springer, vol. 0, pages 1-24.
    3. Kyeong Ho Lee & Marc F. Bellemare, 2013. "Look Who's Talking: The Impacts of the Intrahousehold Allocation of Mobile Phones on Agricultural Prices," Journal of Development Studies, Taylor & Francis Journals, vol. 49(5), pages 624-640, May.
    4. Paunov, Caroline & Rollo, Valentina, 2016. "Has the Internet Fostered Inclusive Innovation in the Developing World?," World Development, Elsevier, vol. 78(C), pages 587-609.
    5. 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.
    6. Juan M. Gallego & Luis H. Gutiérrez & Sang H. Lee, 2015. "A firm-level analysis of ICT adoption in an emerging economy: evidence from the Colombian manufacturing industries," Industrial and Corporate Change, Oxford University Press, vol. 24(1), pages 191-221.
    7. Ariel Herbert FAMBEU, 2016. "Déterminants De L’Adoption Des Tic Dans Un Pays En Développement : Une Analyse Économétrique Sur Les Entreprises Industrielles Au Cameroun," Region et Developpement, Region et Developpement, LEAD, Universite du Sud - Toulon Var, vol. 43, pages 159-186.
    8. 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.
    9. K. Sudhir & Debabrata Talukdar, 2015. "The “Peter Pan Syndrome” in Emerging Markets: The Productivity-Transparency Tradeoff in IT Adoption," Cowles Foundation Discussion Papers 1980, Cowles Foundation for Research in Economics, Yale University.
    10. 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).
    11. repec:oup:ajagec:v:99:y:2017:i:1:p:1-18. is not listed on IDEAS
    12. Nidhiya Menon, 2015. "Gender And Technology Use In Developing Countries: Evidence From Firms In Kenya," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 40(3), pages 105-140, September.
    13. K L Krishna & Abdul A Erumban & Bishwanath Goldar & Deb Kusum Das & Suresh Chand Aggarwal & Pilu Chandra Das, 2018. "ICT investment and economic growth in India: An industry perspective," Working papers 284, Centre for Development Economics, Delhi School of Economics.
    14. Basant, Rakesh & Sharma, Shruti, 2014. "ICT Adoption and Organizational Change in Public and Private Enterprises," IIMA Working Papers WP2014-01-04, Indian Institute of Management Ahmedabad, Research and Publication Department.
    15. 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.

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