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Impact Of The Adoption Of Information And Communication Technologies On Firm Efficiency In The Tunisian Manufacturing Sector

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  • Rim Ben Ayed Mouelhi

    () (Department of Economics, ISCAE, University of La Manouba, Tunisia)

Abstract

This paper aims at measuring the impact of information and communication technologies (ICT) use on the efficiency of the Tunisian manufacturing sector, at the firm level within a simple theoretical framework. We use a firm-level panel data for the manufacturing sector in Tunisia to investigate whether adoption of ICT influences efficiency in factors use. The analysis is conducted through the use of a parametric method to measure technical efficiency. We estimate a stochastic production frontier and the relationship aimed to explain technical efficiency differentials in a single stage as suggested by Battese and Coelli (1995). The results confirm the presence of positive returns to ICT capital. We find that the impact of ICT on efficiency is strong. Our results also suggest that it is important to carefully control for human capital related characteristics of employment when studying the effect of ICT. The evidence shows that achieving benefits from investment in ICT requires complementary investments and changes in human capital. This means that the combined use of ICT and human capital in a firm would enhance its efficiency beyond the direct effects of these factors taken alone.

Suggested Citation

  • Rim Ben Ayed Mouelhi, 2009. "Impact Of The Adoption Of Information And Communication Technologies On Firm Efficiency In The Tunisian Manufacturing Sector," Working Papers 506, Economic Research Forum, revised Oct 2009.
  • Handle: RePEc:erg:wpaper:506
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    References listed on IDEAS

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    1. World Bank, 2006. "2006 Information and Communications for Development : Global Trends and Policies," World Bank Publications, The World Bank, number 6967.
    2. Baldwin, John R. & Sabourin, David, 2001. "Impact of the Adoption of Advanced Information and Communication Technologies on Firm Performance in the Canadian Manufacturing Sector," Analytical Studies Branch Research Paper Series 2001174e, Statistics Canada, Analytical Studies Branch.
    3. Meeusen, Wim & van den Broeck, Julien, 1977. "Efficiency Estimation from Cobb-Douglas Production Functions with Composed Error," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 18(2), pages 435-444, June.
    4. Igbekele A. Ajibefun, 2008. "Technical Efficiency Analysis of Micro-enterprises: Theoretical and Methodological Approach of the Stochastic Frontier Production Functions Applied to Nigerian Data," Journal of African Economies, Centre for the Study of African Economies (CSAE), vol. 17(2), pages 161-206, March.
    5. Pitt, Mark M. & Lee, Lung-Fei, 1981. "The measurement and sources of technical inefficiency in the Indonesian weaving industry," Journal of Development Economics, Elsevier, vol. 9(1), pages 43-64, August.
    6. Battese, G E & Coelli, T J, 1995. "A Model for Technical Inefficiency Effects in a Stochastic Frontier Production Function for Panel Data," Empirical Economics, Springer, vol. 20(2), pages 325-332.
    7. Aigner, Dennis & Lovell, C. A. Knox & Schmidt, Peter, 1977. "Formulation and estimation of stochastic frontier production function models," Journal of Econometrics, Elsevier, vol. 6(1), pages 21-37, July.
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