nep-ict New Economics Papers
on Information and Communication Technologies
Issue of 2019‒09‒16
nine papers chosen by
Marek Giebel
Universität Dortmund

  1. Retailer Banks Information Technology Governance impact on customers statisfaction By Mohmed Mustafa
  2. The role of ICT in modulating the effect of education and lifelong learning on income inequality and economic growth in Africa By Vanessa S. Tchamyou; Simplice A. Asongu; Nicholas M. Odhiambo
  3. The supply of foreign talent: How skill-biased technology drives the skill mix of immigrants Evidence from Switzerland 1990–2010 By Andreas Beerli; Ronald Indergand; Johannes Kunz
  4. The impact of technological revolution on poverty: a case of South Africa By HANNAH DUNGA
  5. The Factors Which Lead Brands To Use Social Media In External Corporate Communication By Gulcin Ipek Emeksiz
  6. The macroeconomic consequences of artificial intelligence: A theoretical framework By Huang, Xu; Hu, Yan; Dong, Zhiqiang
  7. Profit-Sharing Rules and the Taxation of Multinational Internet Platforms By Francis Bloch; Gabrielle Demange
  8. Artificial Intelligence Market Disruption By Julia M. Puaschunder
  9. Controlling as driving force at today?s dynamic changing companies By KÁROLY SZÓKA; BRIGITTA KOVÁCS

  1. By: Mohmed Mustafa (Ritsumeikan Asia Pacific University)
    Abstract: Information technology IT has become essential component in retailer banks business model, by heavily investing in information technology assets banks are able to offer numerous e-services via new innovative channels. This development makes it imperative to adapt standard IT management framework to insure high investment return and customers satisfaction. This paper examines the relation between retailer banks IT governance practices and banks customers satisfaction. For this purpose, questionnaires developed using COBIT5 IT governance framework as benchmark and sent to 4 retailer Banks IT managers. another questionnaire filled up by 350 this bank?s customers to assess their level of satisfaction. The results show that all banks understudy partially adapting Cobit5 framework process, it also indicates that some process such as services delivery and aligned planing and organization has higher impact on customers satisfaction level.
    Keywords: IT governance, Cobit 5,IT Audit , Customers satisfaction
    JEL: L86
    Date: 2019–06
  2. By: Vanessa S. Tchamyou (University of Antwerp, Belgium); Simplice A. Asongu (Yaoundé, Cameroon); Nicholas M. Odhiambo (University of South Africa, Pretoria, South Africa)
    Abstract: This study assesses the role of ICT in modulating the impact of education and lifelong learning on income inequality and economic growth. It focuses on a sample of 48 African countries from 2004 to 2014. The empirical evidence is based on the generalised method of moments (GMM). The following findings are established. First, mobile phone and internet each interact with primary school education to decrease income inequality. Second, all ICT indicators interact with secondary school education to exert a negative impact on the Gini index. Third, fixed broadband distinctly interacts with primary school education and lifelong learning to have a positive effect on economic growth. Fourth, ICT indicators do not significantly influence inequality and economic growth through tertiary school education and lifelong learning. These main findings are further substantiated. Policy implications are discussed.
    Keywords: Education; Lifelong learning; ICT; Inequality; Africa
    JEL: I28 I20 I30 L96 O55
    Date: 2019–01
  3. By: Andreas Beerli (KOF Swiss Economic Institute, ETH Zurich, Switzerland); Ronald Indergand (Staatssekretariat für Wirtschaft SECO); Johannes Kunz (Centre for Health Economics)
    Abstract: An important goal of immigration policy is facilitating the entry and supply of workers whose skills are scarce in national labour markets. In recent decades, the introduction of information and communication technology [ICT] fuelled the demand for highly skilled workers at the expense of lower skill groups throughout the developed world. In this paper, we show that the skill mix of newly arriving immigrants strongly responded to this shift in the demand for skills. Exploiting the fact that different regions in Switzerland were differentially exposed to ICT due to their pre-ICT industrial composition, we present evidence suggesting more exposed regions experienced stronger growth in relative employment and wage premia for highly skilled workers between 1990 and 2010. We find robust evidence that regions with higher initial ICT exposure experienced a considerably stronger relative influx of highly skilled immigrants. Taken together, these results strongly sug- gest that immigrants responded to skill-biased changes in economic opportunities. Complementing these findings, we document whether and how the response of immigrants to skill demand changed when Switzerland abolished immigration restrictions for European workers.
    Keywords: Keywords: immigrant sorting, international migration; routine-biased technical change; information and communication technology; skill supply
    JEL: F22 J61 J24 J31 J23
    Date: 2017–11
    Abstract: The world has experienced a massive transformation since the establishment of the first industrial revolution which seemed as a breakthrough for humankind. The first industrial revolution transformed from an agrarian and handcraft world to the use of machines that were powered by water and steam. This was followed by what is called the second and subsequently the third industrial revolution the two led to an establishment of electric power to create mass production and the use of electronics and information technology to automate production. In a short while technology evolved rapidly birthing what is so called the current fourth industrial revolution. Unlike the past three evolutions, the fourth industrial revolution has rapidly transformed the way of life to a sophisticated digitalized world where everything is made instant. In as far as such improvements in the technological sphere are important, the fourth industrial revolution is receiving so much critic in most industries, this paper highlights the effects of the fourth industrial revolution on the poor people or those on the boundary of poverty. The premise of the paper is that Industry 4.0 as it is also known, has made life better and easier for those that are involved and has paradoxically made the gap between the educated and the uneducated even wider. The usage of technological advancements is associated with income in a way that those that do not have access to such income as would enable them to afford any technological gadget and hence know how, are left behind by unprecedented gaps. This paper therefore analyses the relationship between technological advances proxied by access to cell phone and data, and poverty in South Africa. To achieve this the paper will employ data obtained from 2017 General household survey data from STATS SA. The apriori expectation is that households that are able to move with technology do so at very high opportunity cost and hence may trade off technology with basic needs that end up pushing them deeper into poverty.
    Keywords: Fourth industrial revolution; poverty; technology; households; trade-off
    JEL: I30
    Date: 2019–06
  5. By: Gulcin Ipek Emeksiz (Anadolu University, Communication Sciences Faculty, Department of Communication Design and Management)
    Abstract: Social media is the new form of today?s communication. People spend a lot of time on social media to be informed about and to interact with the happenings in their social environments, and in the meantime they want to reach their favourite brands. Therefore, many brands have started to open brand fan pages in different social media platforms such as Facebook, Twitter and Instagram to get in touch with their consumers. There are many factors which have led brands to use social media in external corporate communication; however, these are not pointed out in detail in the literature. This paper aims to cover the factors which have motivated brands to use social media in external corporate communication. The paper first explores the reasons behind the decline of trust towards traditional advertisements and the advertisements on the Internet. Afterwards, it discusses why websites have recently lost their popularity against social media platforms. Lastly, it looks at why consumers want a presence of brands in social media. The results show that today?s consumers tend to trust electronic word of mouth in social media platforms more than traditional advertisements since they can learn online the experiences of people who have tried the products and services of brands. Furthermore, many consumers feel bothered from the advertisements which drop into their e-mail boxes and the Internet banners which pop up. Interactivity in social media is the main factor which has caused social media to get one step more forward than the websites. Today?s consumers want to engage in dialogues with their favourite brands and have in touch with them on social media. This paper will contribute to the literature of corporate communication from the aspect of social media.
    Keywords: brands, corporate communication, external, factors, social media
    JEL: M30
    Date: 2019–07
  6. By: Huang, Xu; Hu, Yan; Dong, Zhiqiang
    Abstract: The authors explore the impact of artificial intelligence on the economy by improving the neoclassical production function and the task-based model. Based on the capital accumulation of artificial intelligence and technological progress, they present a theoretical model that explores the effect of alternative and complementary artificial intelligence on wages, capital prices, labor share, capital share and economic growth. The model shows that artificial intelligence capital lowers the capital prices and increases wages. In addition, if artificial intelligence and labor force are complementary, artificial intelligence capital has a positive impact on labor share, but if artificial intelligence and labor force can substitute each other, labor share is negatively influenced by artificial intelligence capital. The authors extend the task-based model and find that technological progress increases both wages and labor share by generating new tasks. In the long run, without consideration of exogenous technology, as the artificial intelligence capital accumulates, per capita output, per capita traditional capital and per capita artificial intelligence capital grow at the same rate, and economic growth finally reaches steady state equili- brium. With exogenous technology considered, artificial intelligence technology improves, and sustained economic growth is achieved.
    Keywords: artificial intelligence,automation,economic growth,share of labor
    JEL: J23 J24
    Date: 2019
  7. By: Francis Bloch; Gabrielle Demange
    Abstract: This paper analyzes taxation of an Internet platform attracting users from different jurisdictions. When corporate income tax rates are different in the two jurisdictions, the platform distorts prices and outputs in order to shift profit to the low-tax country. We analyze the comparative statics effects of an increase in the tax rate of one country. When cross-effects are present in both countries, the platform has an incentive to increase the number of users in the high-tax country and decrease the number of users in the low-tax country. When externalities only flow from one market to another, an increase in the corporate tax rate results either in a decrease or an increase in the number of users in both countries depending on the direction of externalities. We compare the baseline regime of separate accounting (SA) with a regime of formula apportionment (FA), where the tax bill is apportioned in proportion to the number of users in the two countries. Under FA, an increase in the corporate tax rate increases the number of users in the low-tax country and decreases the number of users in the high-tax country. We use a numerical simulation to show that the high-tax country prefers SA to FA whereas the low-tax country prefers FA to SA.
    Keywords: digital platforms, multinational firms, corporate income taxation, formula apportionment, separate accounting
    JEL: H32 H25 L12 L14
    Date: 2019
  8. By: Julia M. Puaschunder (The New School, Department of Economics)
    Abstract: The introduction of Artificial Intelligence in our contemporary society imposes historically unique challenges for humankind. The emerging autonomy of AI holds unique potentials of eternal life of robots, AI and algorithms alongside unprecedented economic superiority, data storage and computational advantages. Yet to this day, it remains unclear what impact AI taking over the workforce will have on economic growth.
    Keywords: AI, AI-GDP Index, AI market entry, Artificial Intelligence, capital, economic growth, endogenous growth, exogenous growth, Global Connectivity Index, GDP, Gross Domestic Product, labor, law and economics, society, State of the Mobile Internet Connectivity, workforce
    Date: 2019–07
  9. By: KÁROLY SZÓKA (University of Sopron, Institute of Finance and Accounting); BRIGITTA KOVÁCS (University of Sopron, István Széchenyi Management and Organizational Sciences Doctoral School)
    Abstract: The task of controlling is to support the management with reports, forecasts and analyses in order to be able to take economically rational decisions. In today?s fast changing economic and information technological environment the management has to react rapidly. This means new challenges for controlling. Due to digitalization, even more real time data is available, can be stored and shared fast. This lead to a change of controlling processes. The focus of reports changed from analysing past figures to current and future trends. Controlling become the strategic early warning system of the companies. This changes the role of controllers, as it is transforming into business partners of management, and also new roles, like Data Scientist will turn up and new skills are needed. Controlling support management to take more adequate decisions, what secure the long-term survival of the company, so in an indirect way the transformation of controlling is a driving force of the companies at today?s dynamically changing environment.
    Keywords: controlling, driving force, changing environment, digitalization
    JEL: M49 O11 O20
    Date: 2019–07

This nep-ict issue is ©2019 by Marek Giebel. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.