nep-ict New Economics Papers
on Information and Communication Technologies
Issue of 2010‒04‒17
six papers chosen by
Walter Frisch
University Vienna

  1. A multivariate probit analysis of Korean firms¡¯information system adoption: An empirical analysis on the determinants of the adoption and complementarity among the information systems By Jae Young Choi; Yeonbae Kim; Yungman Jun; Yunhee Kim
  2. Mining Ideas from Textual Information By D. THORLEUCHTER; D. VAN DEN POEL; A. PRINZIE;
  3. Information technology and banking organization By Sauro Mocetti; Marcello Pagnini; Enrico Sette
  4. Competition in the Korean Internet Portal Market: Network Effects, Profit, and Market Efficiency By Junseok Hwang; Dongook Choi; Jongeun Oh; Yeonbae Kim
  5. Centralizing Information in Networks By Jeanne Hagenbach
  6. The Optimal Structure of Technology Adoption and Creation: Basic Research vs. Development in the Presence of Distance to Frontier By Ha, Joonkyung; Jin Kim, Yong; Lee, Jong-Wha

  1. By: Jae Young Choi; Yeonbae Kim; Yungman Jun; Yunhee Kim (Technology Management, Economics and Policy Program(TEMEP), Seoul National University)
    Abstract: As the ICT industry continues to grow, firms worldwide continue to adopt and use enterprise information systems. Although there is some existing research on the determinants of firms¡¯ information system adoption, most such studies do not take into account a firm¡¯s adoption of more than one information system (multiple adoption behaviour). Moreover, small sample sizes have hindered the ability of many previous empirical studies of information system adoption to report strongly reliable results. Using a Bayesian multivariate probit approach, this study examines a sample of 438 Korean companies covering a variety of business areas, including manufacturing, to investigate the determinants of firms¡¯ adoption of and the substitutionary patterns among four major information systems: enterprise resource planning (ERP), customer relationship management (CRM), e-buy, and groupware. As a result, the epidemic effect generally outweighs the size effect and putting more effort into the intensity of information strategy planning is very influential on the adoption of information systems. And a relatively strong complementary relationship exists between ERP adoption and CRM adoption, and between e-buy adoption and groupware adoption.
    Keywords: Information System adoption, Bayesian multivariate probit, ERP,; CRM, e-buy, groupware, Korea
    Date: 2009–10
    Abstract: This approach introduces idea mining as process of extracting new and useful ideas from unstructured text. We use an idea definition from technique philosophy and we focus on ideas that can be used to solve technological problems.<br> The rationale for the idea mining approach is taken over from psychology and cognitive science and follows how persons create ideas. To realize the processing, we use methods from text mining and text classification (tokenization, term filtering methods, Euclidean distance measure etc.) and combine them with a new heuristic measure for mining ideas.<br> As a result, the idea mining approach extracts automatically new and useful ideas from a user given text. We present these problem solution ideas in a comprehensible way to support users in problem solving. This approach is evaluated with patent data and it is realized as a web-based application, named 'Technological Idea Miner' that can be used for further testing and evaluation.
    Keywords: Idea Mining, Text Mining, Text Classification, Technology
    Date: 2009–11
  3. By: Sauro Mocetti (Bank of Italy); Marcello Pagnini (Bank of Italy); Enrico Sette (Bank of Italy)
    Abstract: We investigate the impact of information and communication technologies (ICT) on local loan officersÂ’ autonomy in small business lending. We derive a simple agency model of the interaction between a local branch manager and the headquarters, which yields an estimable equation for the optimal delegation of authority. Using a unique and specifically tailored dataset including about 300 Italian banks, we show that banks equipped with more ICT capital and resorting to credit scoring delegate more decision-making power to their local branch managers. These results are robust to many additional controls, including instrumental variable estimation. The effects on decentralization are strengthened for those banks that jointly hold higher ICT capital endowments and adopt credit scoring.
    Keywords: ICT, credit scoring, delegation, banking organization, local branch manager, small business lending
    JEL: L22 M54 O33
    Date: 2010–03
  4. By: Junseok Hwang; Dongook Choi; Jongeun Oh; Yeonbae Kim (Technology Management, Economics and Policy Program(TEMEP), Seoul National University)
    Abstract: Internet portals serve as platforms that coordinate advertising and user markets, and the portal market features network effects within and between both sides. We model the market structure in order to explain network effects and other factors of competition such as prices for advertisements, contents, and differentiated services offered. We empirically identify these effects with data from South Korea and analyze the role of the effects in terms of profit and market efficiency. The results indicate that a negative indirect network effect exists in the user market but is prevailed over by the direct network effect. This explains how Internet portals make profits by increasing user visits. Further, we show the existence of network effects causes consumer¡¯s surplus not to decrease with market concentration.
    Keywords: Internet Portal Industry, Network Effect, Two-sided Market, Market Efficiency
    JEL: D21 H25 H32 L11
    Date: 2009–10
  5. By: Jeanne Hagenbach (University of Mannheim)
    Abstract: In the dynamic game we analyze, players are the members of a fixed network. Everyone is initially endowed with an information item that he is the only player to hold. Players are offered a finite number of periods to centralize the initially dispersed items in the hands of any one member of the network. In every period, each agent strategically chooses whether or not to transmit the items he holds to his neighbors in the network. The sooner all the items are gathered by any individual, the better it is for the group of players as a whole. Besides, the agent who first centralizes all the items is offered an additional reward that he keeps for himself. In this framework where information transmission is strategic and physically restricted, we provide a necessary and suffcient condition for a group to pool information items in every equilibrium. This condition is independent of the network structure. The architecture of links however affects the time needed before items are centralized in equilibrium.
    Keywords: communication network, communication dilemma, dynamic network game, strategic communication, war of attrition
    JEL: D83 C72 L22
    Date: 2010–04
  6. By: Ha, Joonkyung (Hanyang University); Jin Kim, Yong (Ajou University); Lee, Jong-Wha (Asian Development Bank)
    Abstract: This paper presents a theoretical model and empirical evidence to explain the observation that a country in which the level of technology approaches the technology frontier tends to rely more on technology creation than adoption, and to invest more in basic research than in development. The model shows that technology creation involves both basic and development research processes while technology adoption uses only the latter process. Thus, research and development (R&D) investment in our model involves three different processes: basic research in technology creation, development in technology creation, and development in technology adoption. The results suggest first, that the rate of growth is positively correlated with the level of basic research activities in the technology creation sector, if one country’s technology gap with the technology frontier is small enough. Second, an increase in the efficiency of the education system for highly skilled workers raises the level of basic research and the rate of growth. Third, verifying these theoretical results, empirical analyses using panel data of Japan; Republic of Korea; and Taipei,China show that the narrower the technological distance to the frontier, the higher the growth effect of basic R&D, indicating that the share of basic R&D matters for economic growth. Last, these also show that the quality of tertiary education has a significantly positive effect on the productivity of R&D.
    Keywords: Basic research; technology creation; technology adoption; economic growth
    JEL: O31 O47
    Date: 2009–06

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