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The Impact of Internet Banking on the Performance of Micro and Small Enterprises in Costa Rica: A Randomized Controlled Experiment

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  • Comisión Asesora en Alta Tecnología

Abstract

This paper uses a randomized controlled experiment in Costa Rica to determine whether IB use by Banco Nacional de Desarrollo's micro and small enterprise (MSE) clients has an impact on their performance, measured in terms of productivity, increase in sales, and cost reduction. Results from the intervention group surveys indicate that Internet use is limited in MSEs' daily operations because of limited access to computers and the relatively low penetration of Internet services in employees' activities. In addition, firms have limited knowledge about the uses of the Internet as a business development tool. These results contrast with the reported benefits obtained by a small group of firms. Those benefits include reduced costs, higher sales, and better contact with customers.

Suggested Citation

  • Comisión Asesora en Alta Tecnología, 2011. "The Impact of Internet Banking on the Performance of Micro and Small Enterprises in Costa Rica: A Randomized Controlled Experiment," IDB Publications (Working Papers) 3374, Inter-American Development Bank.
    • Handle: RePEc:idb:brikps:3374
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    More about this item

    Keywords

    information and communications technologies; internet banking; microenterprise; business development;
    All these keywords.

    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy

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