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The Impact of Information Technology on Productivity in Developing Countries

Ronia Hawash () and Günter Lang ()
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Ronia Hawash: Faculty of Management Technology, The German University in Cairo

No 19, Working Papers from The German University in Cairo, Faculty of Management Technology

Abstract: The information technology (IT) revolution has resulted in a digital divide evolving between nations that have the skills and capability to absorb these new technologies, and those without. Since developing countries have assumed that the adoption of IT may be their key engine of growth, they have exerted a lot of efforts in an attempt to overcome this digital gap. This study tests whether higher IT adoption results in higher total factor productivity (TFP) growth of developing countries or not, by conducting a panel data regression for 33 developing countries over the period 2002-2006. It also examines the relative importance of IT adoption in comparison to other technological aspects such as: Technology creation, technology transfer, and enhancing individuals’ technological absorptive capacities through higher educational levels. The study concludes that IT adoption and higher educational attainment tend to relatively be the most significant factors affecting TFP growth in developing countries.

Keywords: Information Technology; Productivity; Digital Divide; Development (search for similar items in EconPapers)
JEL-codes: O33 O47 (search for similar items in EconPapers)
Pages: 22 pages
Date: 2010-02
New Economics Papers: this item is included in nep-eff and nep-ict
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http://mgt.guc.edu.eg/wpapers/019hawash_lang2010.pdf First version, 2010 (application/pdf)

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