nep-ict New Economics Papers
on Information and Communication Technologies
Issue of 2019‒05‒20
eight papers chosen by
Marek Giebel
Universität Dortmund

  1. Remittances, the Diffusion of Information and Industrialisation in Africa By Simplice A. Asongu; Nicholas M. Odhiambo
  2. Credence goods markets and the informational value of new media: A natural field experiment By Rudolf Kerschbamer; Daniel Neururer; Matthias Sutter
  3. Does Credit Reporting Lead to a Decline in Relationship Lending? Evidence from Information Sharing Technology By Sutherland, Andrew
  4. Knowledge Economy and Economic Development in the Arab Region By Satti Osman Mohamed Nour, Samia
  5. Like it or not? The impact of online platforms on the productivity of incumbent service By Alberto Bailin Rivares; Peter Gal; Valentine Millot; Stéphane Sorbe
  6. Information Technology Role in Determining Communication Style Prevalent Among Al-Azhar University Administrative Staff By Husam R.; Samy S. Abu Naser; Suliman A El Talla; Mazen J Al Shobaki
  7. "The race for innovation in the media and content industries: legacy players and newcomers. Lessons from the music and newspaper industries" By Pierre-Jean Benghozi; Elisa Salvador; Jean-Paul Simon
  8. Avoiding a “No Deal” Scenario: Free Trade Agreements, Citizenship and Economic Rights By Ojo, Marianne

  1. By: Simplice A. Asongu (Yaoundé/Cameroon); Nicholas M. Odhiambo (Pretoria, South Africa)
    Abstract: This study examines the role of information and communication technology (ICT) on remittances for industrialisation in a panel of 49 African countries for the period 1980-2014. The empirical evidence is based on three simultaneity-robust estimation techniques, namely: (i) Instrumental Fixed Effects (FE) in order to control for the unobserved heterogeneity; (ii) Generalised Method of Moments (GMM) to account for persistence in industrialisation; and (iii) Instrumental Quantile Regressions (QR) to control for initial levels of industrialisation. Our best estimators are from FE and QR estimations because the GMM regression outputs largely fail post-estimation diagnostic tests. The following findings are established: (i) There are positive marginal effects from the interaction between remittances and ICT in the FE regressions whereas there are negative marginal impacts from the interaction between remittances and ICT; (ii) Interactions between remittances and mobile phone penetration are positive in the bottom and 90th quantiles whereas the interaction between internet penetration and remittances is positive in the bottom and top quantiles of the industrialisation distribution. Overall, the role of ICT in remittances for industrialisation is much more apparent when existing levels of industrialisation are accounted for. The findings contribute to the debates on the importance of external flows and information infrastructure in economic growth as well as the relevance of remittances in driving economic development in environments where institutions are weak. The value of the study to scholars and policy makers also builds on the fact that the potential for ICT and remittances in Africa can be leveraged to address development challenges on the continent such as the low level of industrialisation.
    Keywords: Remittances; Industrialisation; ICT; Africa
    JEL: F24 F43 O30 O55
    Date: 2019–01
  2. By: Rudolf Kerschbamer (University of Innsbruck); Daniel Neururer (University of Innsbruck); Matthias Sutter (Max Planck Institute for Research on Collective Goods)
    Abstract: Credence goods markets are characterized by pronounced informational asymmetries between consumers and expert sellers. As a consequence, consumers are often exploited and market efficiency is threatened. However, in the digital age, it has become easy and cheap for consumers to self-diagnose their needs using specialized webpages or to access other consumers’ reviews on social media platforms in search for trustworthy sellers. We present a natural field experiment that examines the causal effect of information acquisition from new media on the level of sellers’ price charges for computer repairs. We find that even a correct self-diagnosis of a consumer about the appropriate repair does not reduce prices, and that an incorrect diagnosis more than doubles them. Internet ratings of repair shops are a good predictor of prices. However, the predictive valued of reviews depends on whether they are judged as reliable or not. For reviews recommended by the platform Yelp we find that good ratings are associated with lower prices and bad ratings with higher prices, while non-recommended reviews have a clearly misleading effect, because non-recommended positive ratings increase the price.
    Keywords: credence goods, fraud, information acquisition, internet, field experiment
    JEL: C93 D82
    Date: 2019–03
  3. By: Sutherland, Andrew
    Abstract: I examine how credit reporting affects where firms access credit and how lenders contract with them. I use within firm-time and lender-time tests that exploit lenders joining a credit bureau and sharing information in a staggered pattern. I find information sharing reduces relationship-switching costs, particularly for firms that are young, small, or have had no defaults. After sharing, lenders transition away from relationship contracting, in two ways: contract maturities in new relationships are shorter, and lenders are less willing to provide financing to their delinquent borrowers. My results highlight the mixed effects of transparency-improving financial technologies on credit availability.
    Keywords: Debt contracts; information sharing; information asymmetries; hard and soft information; credit bureaus; relationship lending; transactional lending; information economics; entrepreneurial finance; credit reports; credit scores, FinTech
    JEL: D82 D83 G21 G23 G30 G32 M41
    Date: 2018
  4. By: Satti Osman Mohamed Nour, Samia (Faculty of Economic and Social Studies, Khartoum University)
    Abstract: This paper aims to discuss the relationship between knowledge, knowledge economy and economic development in the Arab region. It aims to contribute to improve understanding and provide valuable contribution to the increasing debate in the international literature concerning the relationship between knowledge economy and economic development in the Arab region. We use the descriptive and comparative approaches and methods of analysis and use the conceptual framework and indicators often used in the international literature to discuss the relationship between knowledge, knowledge economy and economic development in the Arab region. Different from previous studies in the Arab literature, we fill the gap in the Arab literature, we present an in-depth and a more comprehensive analysis of the relationship between knowledge economy and economic development in the Arab region defined by income level using recent secondary data related to knowledge economy obtained from the Global Innovation Index Report (2018) and the World Bank (2012). Our results support the first hypothesis concerning the considerable variation in the promotion of knowledge economy depending on the level of economic development across the Arab countries. Our findings verify the second hypothesis that the relationship between knowledge economy and economic development in the Arab region is determined by several factors including economic development, economic incentives and institutional regime, education and human resources, innovation system and Information and Communication Technology. Our results support the third hypothesis that sound and coherent policies for the promotion of knowledge economy through the promotion of economic incentives and institutional regime, education and human resources, the innovation system and Information and Communication Technology would contribute to accelerate achievement of inclusive growth and sustainable development in the Arab countries. Our results in the Arab region show positive relationship between income level and knowledge index, knowledge economy index and knowledge economy index and most of knowledge economy indicators including knowledge workers, knowledge-intensive employment, knowledge absorption, knowledge and technology outputs, knowledge impact and knowledge diffusion. Our findings in the Arab region show positive relationship between income level and all knowledge economy index pillars (economic incentive and institutional regime pillar, education and human resources pillar, the innovation system pillar, and information and communication technology (ICT) pillar) and all factors facilitating the promotion of knowledge economy including institutions, human capital and research, education, tertiary education, research & development (R&D), infrastructure, information and communication technologies, and innovation. The major policy implication and recommendation that the promotion of knowledge economy depends on promotion of institutions, economic incentive and institutional regime, education, human resources and research (human capital, education, tertiary education, research & development (R&D)), innovation system (innovation input, output and efficiency) infrastructure, and information and communication technologies.
    Keywords: Knowledge, Knowledge economy, economic development, Arab countries
    JEL: O10 O11 O30
    Date: 2019–04–08
  5. By: Alberto Bailin Rivares; Peter Gal; Valentine Millot; Stéphane Sorbe
    Abstract: This paper uses a novel empirical approach to assess if the development of online platforms affects the productivity of service firms. We build a proxy measure of platform use across four industries (hotels, restaurants, taxis and retail trade) and ten OECD countries using internet search data from Google Trends, which we link to firm-level data on productivity in these industries. We find that platform development supports the productivity of the average incumbent service firm and also stimulates labour reallocation towards more productive firms in these industries. This may notably reflect that platforms’ user review and rating systems reduce information asymmetries between consumers and service providers, enhancing competition between providers. The effects depend on platform type. “Aggregator” platforms that connect incumbent service providers to consumers tend to push up the productivity of incumbents, while more disruptive platforms that enable new types of providers to compete with them (e.g. home sharing, ride hailing) have on average no significant effect on it. Consistent with this, we find that different platform types affect differently the profits, mark-ups, employment and wages of incumbent service firms. Finally, the productivity gains from platforms are lower when a platform is persistently dominant on its market, suggesting that the contestability of platform markets should be promoted.
    Keywords: competition, digital, google trends, platforms, productivity, services, user rating
    JEL: D24 L13 L80 O33
    Date: 2019–05–21
  6. By: Husam R.; Samy S. Abu Naser (Al-Azhar University, Gaza); Suliman A El Talla; Mazen J Al Shobaki
    Abstract: The study aimed at explaining Information Technology Role in Determining Communication Style Prevalent Among Al-Azhar University Administrative Staff. The study population consists of all administrative staff from Al-Azhar University in Gaza. In order to achieve the objectives of the study, the researchers used the random sample method in the study. The study was conducted on a sample of (77) administrative staff from Al-Azhar University with 92.20% response rate. The study reached a number of results, the most important of which is that there is a high degree of satisfaction with the technology used by Gaza from the point of view of the administrative staff, where the percentage (74.14%). There is a high level of satisfaction with the type of Communication Style prevalent at Al-Azhar University-Gaza from the point of view of administrative staff, where the percentage is (71.36%). There is a direct correlation between the Information Technology and the type of Communication Style prevalent, there is a statistically significant impact of Information Technology Role in Determining Communication Style Prevalent Among Al-Azhar University Administrative Staff , the absence of differences between the sample according to the variables (gender, age, years of service, job level) in their perception of the Information Technology and the type of Communication Style prevalent. There are no statistically significant differences in the perception of Information Technology according to the variable of scientific qualification while there are differences in the pattern of Communication Style prevalent, and that the differences in the type of Communication Style prevalent according to the scientific qualification were in favor of holders of the diploma degree and bachelor's degree compared to the higher practical qualifications (postgraduate). The study reached a number of recommendations, the most important of which is that the interest of the departments of the Palestinian universities, especially Al-Azhar University, should be kept abreast of the latest developments in information technology, the need for the university administration to take care of the prevailing Communication Style prevalent and provide easy Communication Style prevalent, the continued administration of universities interest and continuous improvement of the performance of its Administrative Staff, enhance the periodic evaluation of job performance and to inform Administrative Staff and express their opinion. Solving Administrative Staff' problems and giving them the opportunity to contribute to solving their own problems, strengthening the democratic leadership style and empowering university staff.
    Keywords: Palestine,Palestinian Universities,Information Technology,Communication Style prevalent,Administrative Staff,Al-Azhar University
    Date: 2018
  7. By: Pierre-Jean Benghozi (X-DEP-MIE - Département de Management de l'Innovation et Entreprenariat de l'École polytechnique - X - École polytechnique); Elisa Salvador (ESSCA School of Management, 55 quai Alphonse Le Gallo, 92513 Boulogne-Billancourt Cedex, France); Jean-Paul Simon
    Abstract: Cultural and creative industries (CCIs) are usually associated to "creativity" while high-tech industries are usually linked to "innovation". This distinction determines a sort of forgetfulness of the fact that also CCIs rely always on various series of updated technologies. As a consequence, the issue of innovation in CCIs is seldom dealt with. Nonetheless, one can wonder how do these industries really innovate and how they compete with powerful new competitors from the information technology (IT) world. This is the aim of this article focused on the music recording and the newspaper publishing industries. It explores how these industries are coping with subsequent waves of technologies. Recent findings provide a fresh understanding of the place and the very nature of innovation in these industries that, in fact, do not boil down to simply creating new contents. Instead, economic dynamics have recently been opened showing that CCIs are based on regular capacity for innovations which are nevertheless deployed in very different ways. The paper blends a general outlook that sets the scene of the transformations each industry went through with some selected case studies so as to highlight some innovative elements in every subsector. These case studies are followed by an analysis of the new players that build their position from technical intermediation functions. It reveals how "intermediaries"
    Keywords: creative industries,music industry,new middlemen,publishing industry,intermediaries,R&D and innovation
    Date: 2018
  8. By: Ojo, Marianne
    Abstract: Whilst the legal and economic challenges presented by Brexit are gradually becoming more evident, observations and recommendations are already being drawn from consequences of a “ no deal scenario” and particularly the possibilities of entering into a variant of a Free Trade Agreement which should, prevent a “no deal” situation. Such a Free Trade Agreement existing between the current 28 EU Member States and the three EEA European Free Trade Association (EFTA) States Iceland, Liechtenstein and Norway (EEA Internal Market) This paper, amongst other objectives, is aimed at highlighting such proposals which have been put forward to avert a “no deal scenario”. It is obvious that change – and more specifically, fundamental legislative, regulatory overhauls, will require not only the incorporation of expertise from different fields, but also time consuming and costly resources to address the demands of the transitional and implementation periods of such legislatively transformed landscapes. Certainly, a gradual process of incorporating and adapting to new regulatory and legislative changes and environments – and particularly in respect of economically sensitive related matters, would require not only thorough and dedicated observatory and monitoring periods, but also one which facilitates and encourages a process of greater democratic accountability and transparency to be incorporated into the legislative processes. Even though Brexit has generated a great degree of economic uncertainty – which has in turn presented challenges – as well as consequences, it also presents opportunities for new actors to engage and influence vital decision making aspects in areas which particularly revolve around information technology, sustainable development, innovation – as well hybrid financial instruments and volatile mediums which are embodied and personified by crypto currencies, derivatives and other complex financial instruments and mediums of exchange - all of which are reflective of a rapidly changing and evolving financial environment. The challenges now involve to a larger extent, the manner and the degree of relevance to which vital and dominating actors and institutions will be accurately represented and impact future legislation – particularly those which focus around issues relating to trade, environment and sustainable development policies.
    Keywords: financial services; Brexit; Information Technology; innovation; e commerce; sustainability; GATS
    JEL: F1 F16 F18 G1 G14 G18 G3 K2
    Date: 2019–05

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