nep-ict New Economics Papers
on Information and Communication Technologies
Issue of 2016‒02‒29
nine papers chosen by
Walter Frisch
Universität Wien

  1. Mobile information and communication technologies, flexible work organization and labor productivity: Firm-level evidence By Viete, Steffen; Erdsiek, Daniel
  2. Competition in Telecommunications and Internet Services: Problems with Asymmetric Regulations By Paul J.J. Welfens
  3. Diffussion of ICT-products and "five Russias" By Baburin, Vyacheslav; Zemtsov, Stepan
  4. How to fill the digital gap? The (limited) role of regulation By Briglauer, Wolfgang; Cambini, Carlo; Melani, Sauro
  5. ICT and education: evidence from student home addresses By Benjamin Faber; Rosa Sanchis-Guarner; Felix Weinhardt
  6. Analysis of the role of international network effects on the diffusion of second and third generation mobile communication networks By Baquero, Maria; Kuroda, Toshifumi
  7. The price of broadband quality: tracking the changing valuation of service characteristics By Coynea, Bryan; Lyonsa, Sean
  8. Internet and taxation in European Union By Bernardi, Luigi
  9. Do R&D and ICT Affect Total Factor Productivity Growth Differently? By Edquist, Harald; Henrekson, Magnus

  1. By: Viete, Steffen; Erdsiek, Daniel
    Abstract: Mobile information and communication technologies (ICT) have started to diffuse rapidly in the business sector. This study tests for the complementarity between the use of mobile ICT and organizational practices providing workplace flexibility. We hypothesize that mobile ICT can create value if organizational practices grant employees more autonomy over when, where and how to perform work-related tasks. Our data set comprises 1132 German service firms and provides information on the share of employees that have been equipped with mobile devices which allow for wireless internet access, such as notebooks, tablets and smartphones. Workplace flexibility is measured in terms of firms' use of working from home arrangements, working time accounts, and trust-based working time. Within a production function framework, we find that the use of mobile ICT is associated with a productivity premium only in firms granting workplace flexibility by means of trust-based working time. Robustness checks suggest that our results are not driven by ICT-skill complementarity or by complementarity of mobile ICT with multiple alternative modern management practices.
    Keywords: Mobile Information and Communication Technologies,Organizational Practices,Labor Productivity,Complementarity,Firm-Level Data
    JEL: D22 L22 M10 O33
    Date: 2015
  2. By: Paul J.J. Welfens (Europäisches Institut für Internationale Wirtschaftsbeziehungen (EIIW))
    Abstract: With the digital convergence of internet services markets and telecommunications markets, the issue of a common, consistent regulation has become more important. While Google or Facebook can exploit knowledge about the content of “data mails” or SMS, data protection rules for telecommunication operators are different – they cannot use info about “structural content” and are thus unable to generate high revenues from advertising that is based on knowledge about structural content. Internet service providers thus can cross-subsidize digital communication services and thereby gain market shares - based on cross-subsidization - in traditional telecommunication markets. Thus there is a fundamental inconsistency of regulations for internet service providers and telecommunication operators which should be remedied by new global rules for the emerging global communications market. The EU and the US, as well as other countries, plus the ITU should launch a joint initiative in order to create a global level playing field.
    Keywords: Internet services, Telecommunication, Regulation, Digital global markets
    JEL: L86 L96 L98
    Date: 2014–12
  3. By: Baburin, Vyacheslav; Zemtsov, Stepan
    Abstract: The authors explored the potential of new information and communications technologies (ICT) absorption in Russian regions primarily on an example of mobile communication. ICT-sector is rapidly growing, especially in consumer market, and it is an ideal object for diffusion research because it is fast spreading, and it can be obtained by almost all parts of a social system. The purpose was to classify regions by the rate of innovativeness. The saturation rate for mobile phone usage (active SIM cards per 100 people) was used as a proper indicator on the first stage of the research. All regions were classified according to rates of diffusion from 1999 to 2011, and five clusters were identified, corresponding to diffusion stages, identified by E. Rogers: innovators, early adopters, early majority, late majority and laggards. There were four stages of spatial diffusion, according to the theory of T. Hagerstrand. Each stage were determined by several factors. The most influential factors were income, price of services and competition. Mobile phone usage in most Russian regions reached 100% saturation (one active SIM card per capita) in 2006-2007. Later development was determined not by demand for phone connection, but by the demand for internet connection, which was easily provided by mobile systems in smartphones, tablets, and other devices. To assess the innovativeness of regional communities, or their ability to absorb new products, cluster analysis, based on the threshold values of Bass model parameters, was performed. The results were similar to those obtained earlier, but the early appearance of innovators in several regions did not increase the total number of users. Both previous methods of classification could be biased regarding special features of mobile communication diffusion. That is why, on the last stage an integral index of innovativeness was introduced, including rate of diffusion for several ICT-products on the early period of their introduction. The analysis proved that hierarchical model of diffusion from the main centres to secondary prevailed in Russia. Factor of geographical location also played an important role. The research showed the significant difference in the rate of diffusion between Russian regions. Five stable clusters were identified, which were corresponding with idea of “five Russias” existence. Moscow and Saint Petersburg’s rate of diffusion was higher than in most countries, but there was a widespread periphery.
    Keywords: geography of innovation, diffusion of innovation, Russian regions, mobile communication, logistic curve, Bass model, regions-innovators, index of innovativeness
    JEL: L86 O33 O52 R19
    Date: 2014–05–02
  4. By: Briglauer, Wolfgang; Cambini, Carlo; Melani, Sauro
    Abstract: This paper provides evidence on the migration from an 'old' technology to a 'new' technology, taking into account the impact that regulatory interventions on the old one might have on the incentives to invest and adopt the new one. This analysis has been applied to a sample of EU27 countries using panel data from 2004 to 2014 on the adoption, coverage and take-up rate of ultra-fast broadband infrastructures, whose development is one of the flagship initiatives of the Europe 2020 programmes. Results show that a 1% increase in the regulated price to access the old technology increases the adoption and the investment on the new broadband technology by ~0.45% and ~0.47%. These effects are not homogeneous across countries and are weakened in Eastern European countries, where the existing old broadband infrastructures are less developed than in the rest of Europe. It has also been shown that the access price to old networks negatively affects the take-up rate of the new technology-based services, thus calling for the need of more specific and complementary demand side policy incentives to enhance service adoption.
    Keywords: next generation broadband networks,regulation,investment,adoption,take-up,Digital Agenda Europe
    JEL: H5 L38 L43 L52
    Date: 2016
  5. 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 empirical 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 broadband connection speeds have a precisely estimated zero effect on educational 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. While jumps in the available ICT appear to increase student consumption of online content, we find no significant effects on student time spent studying online or offline, or on their learning productivity.
    Keywords: education; information and communication technology; internet
    JEL: D83 I20
    Date: 2015–10
  6. By: Baquero, Maria; Kuroda, Toshifumi
    Abstract: Using quarterly data of 58 countries, this paper provides empirical evidence that mobile phone diffusion from 2007 to 2009 is positively influenced by international network effects. Direct and indirect network effects are a result of the international standadization of telecommunication technologies, which allows consumers in a given country to benefit from other countries' networks by using international roaming services or imported handsets. We define international network effects as the installed base of mobile phone subscribers in countries different than the home country which use the same technology, weighted by various distance metrics. (geographic distance, trade value of mobile handsets and number of personal travelers between the home country and the partner countries.) To measure international network effects, we estimate a series of differentiated-products demand-system models of mobile phones by technology standard with international network effects. To overcome the endogeneity of mobile service price and international network effects, we propose two new instrumental variables (IV). In addition, we test if the impact on mobile phone diffusion differs whether technologies are local or global standards, or whether they are backward/formard-combatible. Based on our findings, we conclude that the large network effects of GSM (Global System for Mobile Communications) technology prevent the diffusion of third generation (3G) mobile phones. We show that the high 3G diffusion rates in Japan and Korea are not driven by state-of-the-art technology or high consumer preference, but by the absence of the GSM standard. Finally, to assess teh effect of technology choice on welfare in Japan, we conduct a counterfactual analysis an demonstrate thar if the GSM technology was introduced in Japan, it would increase Japanese monthly per-consumer surplus from $94.2 to $188.
    Keywords: Cellular telephony,Diffusion,Global standards,Network effect
    JEL: L15 L96 F10
    Date: 2015
  7. By: Coynea, Bryan; Lyonsa, Sean
    Abstract: This paper investigates how retail broadband prices, choice and quality are changing over time. Using a dataset containing daily observations of plans offered in Ireland from 2007 to 2013, this paper applies hedonic modelling techniques to observe the changing pricing of service characteristics. We augment our results by restricting the analysis to large operators and also by weighting by operator market share for a subset of our data (2010-2013). Although we find that average nominal prices remain static throughout our sample period, quality of service has risen dramatically over time, particularly with respect to download speed. Some characteristics of broadband plans exhibit broadly stable valuations over time, but the elasticity of price with respect to advertised download speed and the premium on bundled plans declined during the sample period. In addition, the retail price premium enjoyed by the incumbent operator fell significantly since 2007.
    Keywords: broadband services,market analysis,Ireland
    JEL: L11 L96
    Date: 2015
  8. By: Bernardi, Luigi
    Abstract: The purpose of this paper is to offer a primer on certain important features and issues concerning Internet and taxation in the European Union. After a general introduction concerning the origins of the matter, the paper discusses why a tax on the huge profits made by the big US digital MNEs in Europe was not substantially reflected in the tax policy of EU members, notwithstanding the large tax gap among EU countries resulting from the shift in profits by the (US digital) MNE towards lower or no taxation countries. Then the main directives on Internet and taxation introduced by the EU (and also by the OECD) since the late 1990s are discussed: the EU especially focusses on establishing the due place of taxation on electronic commerce, while the OECD (more recently together with the G20) has placed the emphasis on regulating Transfer Prices and contrasting Base Erosion and Profits’ Shifting (BEPS).
    Keywords: Web Tax; E-commerce; Profits shifting, Europe; OECD
    JEL: H20 H29
    Date: 2015–06–21
  9. By: Edquist, Harald (Erricsson Research); Henrekson, Magnus (Research Institute of Industrial Economics (IFN))
    Abstract: We analyze the effect of ICT and R&D on total factor productivity (TFP) growth across different industries in Sweden. R&D alone is significantly associated with contemporaneous TFP growth, thus exhibiting spillover effects. Although there is no significant short-run association between ICT and TFP, we find a positive association with a lag of seven to eight years. Thus, spillovers from R&D affect TFP much faster than spillovers from ICT-investments. We also divide ICT capital into hardware and software capital. To our knowledge, this distinction has not been made in any previous study analyzing TFP at the industry level. The results show that lagged hardware capital services growth is significantly associated with TFP growth. Hence, investments complementary to hardware are needed to reap the long-run TFP effects from reorganizing production.
    Keywords: ICT; R&D; Spillovers; Total factor productivity; Panel data analysis
    JEL: L16 O33 O47
    Date: 2016–02–08

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