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Transaction Costs, Information Technology and Development

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  • Singh, Nirvikar

Abstract

This paper explores potential channels through which information technology (IT) affects economic development. The channel emphasized here is the reduction of transaction costs through the use of information technology. We discuss the nature of transaction costs, their possible impacts on economic outcomes, and the impacts of IT on transaction costs. We provide a theoretical discussion of how a reduction in transaction costs may affect the number of intermediate goods that are produced, and in turn how that number may affect the development path of the economy. We then draw on our fieldwork in rural India that examined the economics of rural Internet kiosks, and relate this multifaceted case study to the theoretical discussion of transaction costs. We conclude with a broader discussion of the potential impact of IT on developing economies.

Suggested Citation

  • Singh, Nirvikar, 2004. "Transaction Costs, Information Technology and Development," Santa Cruz Department of Economics, Working Paper Series qt3wq7n6nq, Department of Economics, UC Santa Cruz.
  • Handle: RePEc:cdl:ucscec:qt3wq7n6nq
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    Cited by:

    1. Jake Kendall & Nirvikar Singh, 2012. "Performance of Internet Kiosks in Rural India," Review of Market Integration, India Development Foundation, vol. 4(1), pages 1-43, April.
    2. Fuhong Zhang & Apurbo Sarkar & Hongyu Wang, 2021. "Does Internet and Information Technology Help Farmers to Maximize Profit: A Cross-Sectional Study of Apple Farmers in Shandong, China," Land, MDPI, vol. 10(4), pages 1-18, April.
    3. Edy Dwi Kurniati & Indah Susilowati & Suharno, 2019. "Sustainable Competitive Advantage of SMEs through Resource and Institutional-Based Management: An Empirical Study of Batik SMEs in Central Java, Indonesia," Tržište/Market, Faculty of Economics and Business, University of Zagreb, vol. 31(1), pages 61-82.
    4. Martin L. Weitzman, 1998. "Recombinant Growth," The Quarterly Journal of Economics, Oxford University Press, vol. 113(2), pages 331-360.
    5. Georgina W. Njiraini & Djiby Racine Thiam & Anthea Coggan, 2017. "The Analysis of Transaction Costs in Water Policy Implementation in South Africa: Trends, Determinants and Economic Implications," Water Economics and Policy (WEP), World Scientific Publishing Co. Pte. Ltd., vol. 3(01), pages 1-30, January.
    6. Singh, Nirvikar, 2006. "Services-Led Industrialization in India: Assessment and Lessons," Santa Cruz Department of Economics, Working Paper Series qt8jn2b8z6, Department of Economics, UC Santa Cruz.
    7. Jake Kendall & Nirvikar Singh, 2006. "Internet Kiosks in Rural India: What Influences Success?," Working Papers 06-05, NET Institute, revised Sep 2006.
    8. Nijiraini, Georgina & Thiam, Djiby, 2015. "Estimating transaction costs associated with water policy implementation in South Africa," 2015 Conference, August 9-14, 2015, Milan, Italy 212585, International Association of Agricultural Economists.
    9. Dr. Kavita Sexena, 2015. "Position of Information Technology in Service Sector of Indian Economy," Journal of Commerce and Trade, Society for Advanced Management Studies, vol. 10(2), pages 98-102, October.
    10. Nguyen Hung Anh & Wolfgang Bokelmann, 2019. "Determinants of Smallholders’ Market Preferences: The Case of Sustainable Certified Coffee Farmers in Vietnam," Sustainability, MDPI, vol. 11(10), pages 1-20, May.
    11. Richartz, P. Christoph & Abdulai, Awudu & Kornher, Lukas, 2020. "Attribute Non Attendance and Consumer Preferences for Online Food Products in Germany," German Journal of Agricultural Economics, Humboldt-Universitaet zu Berlin, Department for Agricultural Economics, vol. 69(1), March.

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    More about this item

    Keywords

    transaction costs; information technology; Internet; development; India;
    All these keywords.

    JEL classification:

    • P2 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies
    • L31 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Nonprofit Institutions; NGOs; Social Entrepreneurship
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

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