Network Economics and the Digital Divide in Rural India

Jake Kendall, Nirvikar Singh, Kristin Williams (), Yan Zhou () and P.D. Kaushik ()
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Kristin Williams: University of California Santa Cruz
P.D. Kaushik: Rajiv Gandhi Institute of Contemporary Studies

No 07-29, Working Papers from NET Institute

Abstract: The idea of a ‘global digital divide’ is well accepted, and cross-country studies of determinants of differences in computer and Internet penetration have identified income, telecommunications infrastructure, and regulatory quality as key influencing factors. The policy implications from these studies are relatively blunt: get richer, have more telephones, and regulate telecommunications better. In this paper, we examine an alternative policy approach to bridging the digital divide, through organizational innovations that provide low cost Internet access in developing countries, within the existing levels of income, telecommunications infrastructure and regulatory environment. We use survey data from 500 individuals in four states of India: Haryana, Madhya Pradesh, Punjab and Rajasthan, to examine factors influencing patterns of computer and Internet use. The situations in which data was collected were ones where computer and Internet access was being provided by a developmental agency (government or non-government). We estimate logit and multinomial logit models, using explanatory variables such as income, household size, education, and occupation, as well as infrastructure factors such as quality of electricity supply, and availability of telephones and televisions. Thus we are able to go beyond simple analyses of penetration at the country level, to understand the microeconomics of computer and Internet use in rural India. In particular, by examining patterns of use, we are able to comment on the importance of network externalities for diffusion of computers and the Internet in these local rural contexts.

Keywords: IT; ITC; Internet; India; Development; Digital Divide (search for similar items in EconPapers)
JEL-codes: L86 O1 (search for similar items in EconPapers)
Pages: 32 pages
Date: 2007-09, Revised 2007-09
New Economics Papers: this item is included in nep-agr, nep-cwa, nep-net and nep-soc
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