nep-ict New Economics Papers
on Information and Communication Technologies
Issue of 2015‒06‒20
five papers chosen by
Walter Frisch
Universität Wien

  1. ICT and Education: Evidence from Student Home Addresses By Benjamin Faber; Rosa Sanchis-Guarner; Felix Weinhardt
  2. How Important are ICT and R&D Investments for Value Added in the Swedish Business Sector? By Edquist, Harald; Henrekson, Magnus
  3. Internet Use and Ethnic Heterogeneity in a Cross-Section of Countries By Awaworyi Churchill, Sefa; Okai, Davidson; Posso, Alberto
  4. Consumer Preferences for Improvements in Mobile Telecommunication Services By Orhan Dagli; Glenn P. Jenkins
  5. The Impact of Cross-border E-commerce on International Trade By Ayoub yousefi

  1. By: Benjamin Faber; Rosa Sanchis-Guarner; Felix Weinhardt
    Abstract: Governments are making it a priority to upgrade information and communication technologies (ICT) with the aim to increase available internet connection speeds. This paper presents a new strategy to estimate the causal effects of these policies, and applies it to the questions of whether and how ICT upgrades affect educational attainment. We draw on a rich collection of microdata that allows us to link administrative test score records for the population of English primary and secondary school students to the available ICT at their home addresses. To base estimations on exogenous variation in ICT, we notice that the boundaries of usually invisible telephone exchange station catchment areas give rise to substantial and essentially randomly placed jumps in the available ICT across neighboring residences. Using this design across more than 20,000 boundaries in England, we find that even very large changes in available internet speeds have a precisely estimated zero effect on educ ational attainment. Guided by a simple model we then bring to bear additional microdata on student time and internet use to quantify the potentially opposing mechanisms underlying the zero reduced form effect. We find that jumps in the available ICT have no significant effect on student time spent studying online or offline, or on their productivity. Finally, while faster connections appear to increase student consumption of online content, we find that the elasticity of student demand for online content with respect to its time cost is negative but bounded by -1.
    Keywords: Education, information and communication technology, internet
    JEL: I20 D83
    Date: 2015–06
  2. By: Edquist, Harald (Ericsson Research); Henrekson, Magnus (Research Institute of Industrial Economics (IFN))
    Abstract: Since the mid-1990s value added has grown faster in the Swedish business sector than in the business sector of most other OECD countries. We investigate the association between ICT and R&D capital and value added in the Swedish non-farm business sector. By estimating neoclassical production function models on data for 47 different industries for the period 1993–2012 we show that ICT and R&D capital are significantly associated with value added for most specifications. When controlling for economic shocks the results show that on average, if ICT capital increases by 10 percent, value added increases by 1.8 percent. We also divide ICT capital into hardware and software capital. To our knowledge, this distinction has not been made in any previous study at the industry level. In this case only the estimated elasticity of software is significantly different from zero. One possible explanation could be that all industries invest in hardware, but only the ones that successfully invest in and implement software enjoy positive effects from ICT.
    Keywords: ICT; R&D; Industrial change; Panel data
    JEL: O14 O32 O33 O47
    Date: 2015–06–08
  3. By: Awaworyi Churchill, Sefa; Okai, Davidson; Posso, Alberto
    Abstract: This paper investigates the association between ethnic heterogeneity and information technology related outcomes such as internet access and internet use. We argue that the global digital divide, as measured by cross-country differences in internet access and use, could be explained by cross-country differences in ethnic heterogeneity. We use indices of ethnic and linguistic fractionalization as measures of ethnic heterogeneity. Using data on a cross-section of 93 countries, we find evidence of a negative association between ethnic heterogeneity and the use and access of internet. Thus, cross-country differences in the global digital divide can be explained by the levels of ethnic fractionalization. Other determinants of the digital divide include income, infrastructure, literacy level, level of urbanization and inequality.
    Keywords: ethnic diversity,digital divide,information inequality,internet
    Date: 2015–06–16
  4. By: Orhan Dagli (Eastern Mediterranean University, North Cyprus); Glenn P. Jenkins (Queen’s University, Canada and Eastern Mediterranean University, North Cyprus)
    Abstract: We employ a choice experiment in order to estimate consumers’ willingness to pay for improvements in mobile services, focusing on 4G upgrades and roaming services. The attributes of an improved mobile service that we investigate in our experiment are: increased mobile internet speed (possible with 4G), unlimited mobile internet use, improved quality (possible with 4G) and unrestrained use in two neighbouring countries (unrestrained roaming). The results indicate that people value unrestrained roaming services the most. Increased speed and unlimited use attributes are next, and are similarly significant at the 1% level. The impact of improved quality is statistically insignificant at the 5% level, suggesting that consumers are content with the current level of quality they receive with 3G. We conclude that bilateral roaming regulation between governments is more valuable than 4G investments.
    Keywords: Mobile telecommunication services; choice experiment; willingness to pay; consumer preferences; 4G; roaming
    JEL: C5 D12 L96
    Date: 2015–05
  5. By: Ayoub yousefi (King's University College at Western University, Canada)
    Abstract: This study investigates whether the growing cross-border electronic commerce (CBEC) increases the volume of international trade or merely replaces the traditional mode of physical delivery. We carry out a comparative analysis of trade on Digitizable Products (DP) by developed and developing countries. The study suggests that developing countries have in the recent past penetrated into developed countries’ markets and made up for the fall in their share of world Total trade as well as trade in DP. As a result, electronic delivery of digital products promises benefitting developing countries by gaining deeper access to international markets. This is, in part, due to massive Internet penetration and its continued subscription growth. In addition, digitization of information products is taking place at an ever increasing rate which makes it easier to preserve, access and distribute it through the Internet. Granger causality tests suggest that causality runs form export of Digitizable products to the export of Total products for the group of developing countries, China, Hong Kong and Singapore. The results are in line with our earlier descriptive assessment. This result provides foundation for empirical estimation of the impact of CBEC on the volume of international trade. The paper suggests that given its current magnitude, market efficiency, and growth trajectory, CBEC offers an ‘additional’ basis for explaining the flow of international trade, particularly out of developing countries. As a policy implication, we argue that in the transition period e-commerce creates specific challenges as well as new opportunities for businesses and economies around the world. To facilitate growth of CBEC, nations need to adopt new arrangements at the national and international levels. At the national level, governments should provide support and encourage competition and innovation. Governments should also cooperate at the international level though institutions such as WTO, UNCTAD, and EU to enhance security of the Internet and promote fair and transparent operations of e-commerce.
    Keywords: E-Commerce, Cross-border-E-Commerce, International Trade, Granger Causality Test.
    JEL: F14 O30 O57

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