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Regulation and Internet Use in Developing Countries

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  • Wallsten, Scott

Abstract

Concerns about a worsening "digital divide" between rich and poor countries parallel the hope that information technology (IT) could increase economic growth in developing countries. Little research, however, has explored the role of public policies, and of regulation in particular, in IT growth. I use data from a unique new survey of telecommunications regulators and other sources to measure the effects of regulation on Internet development. Controlling for income and other factors that affect demand, I find that countries requiring formal regulatory approval for Internet service providers (ISPs) to operate have fewer Internet users and hosts than countries that do not require such approval. Moreover, countries that regulate ISP prices have higher Internet access prices than countries without such regulations. These results suggest that developing countries' own regulatory policies can have large impacts on IT penetration.

Suggested Citation

  • Wallsten, Scott, 2005. "Regulation and Internet Use in Developing Countries," Economic Development and Cultural Change, University of Chicago Press, vol. 53(2), pages 501-523, January.
  • Handle: RePEc:ucp:ecdecc:y:2005:v:53:i:2:p:501-23
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    File URL: http://dx.doi.org/10.1086/425376
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    Cited by:

    1. Antonio R. Andrés & Voxi Amavilah & Simplice Asongu, 2016. "Linkages between Formal Institutions, ICT Adoption and Inclusive Human Development in Sub Saharan Africa," Working Papers 16/026, African Governance and Development Institute..
    2. Clarke, George R.G., 2008. "Has the internet increased exports for firms from low and middle-income countries," Information Economics and Policy, Elsevier, vol. 20(1), pages 16-37, March.
    3. Mona Badran, 2014. "Young people and the digital divide in Egypt: an empirical study," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 4(2), pages 223-250, December.
    4. Meena Chary, 2007. "Public Organizations in the Age of Globalization and Technology," Public Organization Review, Springer, vol. 7(2), pages 181-189, June.
    5. Nebibe Varol & Joan Costa-i-Font & Alistair McGuire, 2011. "Explaining Early Adoption on New Medicines: Regulation, Innovation and Scale," CESifo Working Paper Series 3459, CESifo Group Munich.
    6. George Clarke & Yue Li & Lixin Colin Xu, 2016. "Business environment, economic agglomeration and job creation around the world," Applied Economics, Taylor & Francis Journals, vol. 48(33), pages 3088-3103, July.
    7. Menzie D. Chinn & Robert W. Fairlie, 2010. "ICT Use in the Developing World: An Analysis of Differences in Computer and Internet Penetration," Review of International Economics, Wiley Blackwell, vol. 18(1), pages 153-167, February.
    8. Andonova, Veneta & Diaz-Serrano, Luis, 2009. "Political institutions and telecommunications," Journal of Development Economics, Elsevier, vol. 89(1), pages 77-83, May.
    9. George R. G. Clarke, 2009. "Beyond Tariffs and Quotas: Why Do African Manufacturers Not Export More?," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 45(2), pages 44-64, March.
    10. George R. G. Clarke, 2009. "Beyond Tariffs and Quotas: Why Do African Manufacturers Not Export More?," Emerging Markets Finance and Trade, M.E. Sharpe, Inc., vol. 45(2), pages 44-64, March.
    11. Li, Raymond & Shiu, Alice, 2012. "Internet diffusion in China: A dynamic panel data analysis," Telecommunications Policy, Elsevier, vol. 36(10), pages 872-887.
    12. Dohse, Dirk & Lim, Cheng Yee, 2016. "Macro-geographic location and internet adoption in poor countries: What is behind the persistent digital gap?," Kiel Working Papers 2067, Kiel Institute for the World Economy (IfW).
    13. Cuberes, David, 2008. "The Diffusion of Internet: A Cross-Country Analysis," MPRA Paper 8433, University Library of Munich, Germany.
    14. Howard, Philip N. & Mazaheri, Nimah, 2009. "Telecommunications Reform, Internet Use and Mobile Phone Adoption in the Developing World," World Development, Elsevier, vol. 37(7), pages 1159-1169, July.
    15. Joan Costa-Font & Alistair McGuire & Nebibe Varol, 2015. "Regulation effects on the adoption of new medicines," Empirical Economics, Springer, vol. 49(3), pages 1101-1121, November.
    16. Biswas, Trina & Kennedy, P. Lynn, 2016. "The Effect of the Internet on Bilateral Trade," 2016 Annual Meeting, February 6-9, 2016, San Antonio, Texas 229994, Southern Agricultural Economics Association.
    17. Galperin, Hernán & Ruzzier, Christian A., 2013. "Price elasticity of demand for broadband: Evidence from Latin America and the Caribbean," Telecommunications Policy, Elsevier, vol. 37(6), pages 429-438.
    18. Feng, Guangchao Charles, 2015. "Determinants of Internet diffusion: A focus on China," Technological Forecasting and Social Change, Elsevier, vol. 100(C), pages 176-185.
    19. Andres, Luis & Cuberes, David & Diouf, Mame Astou & Serebrisky, Tomas, 2007. "Diffusion of the internet : a cross-country analysis," Policy Research Working Paper Series 4420, The World Bank.

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