ICT Adoption and Productivity in Developing Countries: New Firm Level Evidence from Brazil and India

Rakesh Basant (), Simon Commander (), Rupert Harrison () and Naercio Menezes-Filho
Additional contact information
Rakesh Basant: affiliation not available
Simon Commander: IE Business School, Altura Partners
Rupert Harrison: Institute for Fiscal Studies, London

No 2294, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: This paper uses a unique new data set on nearly a thousand manufacturing firms in Brazil and India to investigate the determinants of ICT adoption and its impact on performance in both countries. The descriptive evidence shows that Brazilian firms on average use ICT more intensively than their Indian counterparts but changes over time have been rather similar in both places. Within countries ICT intensity is strongly related to size, ownership structure, share of administrative workers and education. The econometric evidence documents a strong relationship between ICT capital and productivity in both countries, even after controlling for several other factors, including firm-specific fixed-effects. The rate of return of ICT investment seems to be much larger than usually found in more developed countries. Specific types of organisational changes matter for the return of ICT, but only for high adopters. Firms report several constraints to ICT investment in both countries and power disruption seems to significantly depress adoption and returns to ICT expenditures in India. This may be indicative of the impact of a cluster of poor institutions and/or infrastructure on performance.

Keywords: productivity; ICT (search for similar items in EconPapers)
JEL-codes: E20 J2 L20 L60 O33 (search for similar items in EconPapers)
Pages: 48 pages
Date: 2006-09
New Economics Papers: this item is included in nep-cwa, nep-edu, nep-eff, nep-ict and nep-ino
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (18)

Published - published in: Review of Economics and Statistics, 2011

Downloads: (external link)
https://docs.iza.org/dp2294.pdf (application/pdf)

Related works:
Working Paper: ICT adoption and productivity in developing countries: new firm level evidence from Brazil and India (2007)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:iza:izadps:dp2294

Ordering information: This working paper can be ordered from
IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany

Access Statistics for this paper

More papers in IZA Discussion Papers from Institute of Labor Economics (IZA) IZA, P.O. Box 7240, D-53072 Bonn, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Holger Hinte ().