nep-ict New Economics Papers
on Information and Communication Technologies
Issue of 2022‒05‒02
twelve papers chosen by
Marek Giebel
Universität Dortmund

  1. The impact of healthcare IT on clinical quality, productivity and workers By Bronsoler, Ari; Doyle, Joseph; Van Reenen, John
  2. Technological change and domestic outsourcing By Bergeaud, Antonin; Malgouyres, Clement; Mazet-Sonilhac, Clement
  3. Overcoming information asymmetry in the plastics value chain with digital product passports: How decentralised identifiers and verifiable credentials can enable a circular economy for plastics By Berg, Holger; Kulinna, Raik; Stöcker, Carsten; Guth-Orlowski, Susanne; Thiermann, Ricky; Porepp, Natalie
  4. How IT Progress affects Returns to Specialization and Social Skills By Fabienne Kiener; Christian Eggenberger; Uschi Backes-Gellner
  5. Impact of ICT in Enhancing Learning Experience among Rural Students in India: An Empirical Analysis By G.K., Chetan Kumar; K.B., Rangappa; S., Suchitra
  6. (Mis-)information technology: Internet use and perception of democracy in Africa By Joël Cariolle; Yasmine Elkhateeb; Mathilde Maurel
  7. Artificial intelligence and productivity: global evidence from AI patent and bibliometric data. By Aleksandra Parteka; Aleksandra Kordalska
  8. The Environmental Impact of Internet Regulation By Jean-Christophe Poudou; Wilfried Sand-Zantman
  9. Cities fit for the digital age By SULIS Patrizia; VANDECASTEELE Ine; HALMOS Andrea; NI EARCAIN Noirin; MAISTRALI Antigoni; AURAMBOUT Jean-Philippe; LAVALLE Carlo
  10. Artificial Intelligence and international trade: Some preliminary implications By Janos Ferencz; Javier López González; Irene Oliván García
  11. Automation and the Workforce: A Firm-Level View from the 2019 Annual Business Survey By Daron Acemoglu; Gary Anderson; David Beede; Catherine Buffington; Eric Childress; Emin Dinlersoz; Lucia Foster; Nathan Goldschlag; John Haltiwanger; Zachary Kroff; Pascual Restrepo; Nikolas Zolas
  12. Is the Impact of Digitization on Domestic Inflation Non-Linear? The Case of Emerging Markets By Emara, Noha; Zecheru, Daniela

  1. By: Bronsoler, Ari; Doyle, Joseph; Van Reenen, John
    Abstract: Adoption of health information and communication technologies ('HICT') has surged over the past two decades. We survey the medical and economic literature on HICT adoption and its impact on clinical outcomes, productivity and labor. We find that HICT improves clinical outcomes and lowers healthcare costs, but (i) the effects are modest so far, (ii) it takes time for these effects to materialize, and (iii) there is much variation in the impact. More evidence on the causal effects of HICT on productivity is needed to guide further adoption. There is little econometric work directly investigating the impact of HICT on labor, but what there is suggests no substantial negative effects on employment and earnings. Overall, while healthcare is 'exceptional' in many ways, we are struck by the similarities to the wider findings on ICT and productivity stressing the importance of complementary factors (e.g. management and skills) in determining HICT impacts.
    Keywords: healthcare; technology; productivity; jobs; Programme On Innovation and Diffusion (POID)
    JEL: R14 J01 J1
    Date: 2021–09–14
  2. By: Bergeaud, Antonin; Malgouyres, Clement; Mazet-Sonilhac, Clement
    Abstract: Domestic outsourcing has grown substantially in developed countries over the past two decades. This paper addresses the question of the technological drivers of this phenomenon by studying the impact of the staggered diffusion of broadband internet in France during the 2000s. Our results confirm that broadband technology increases firm productivity and the relative demand for high-skill workers. Further, we show that broad-band internet led firms to outsource some non-core occupations to service contractors, both in the low and high-skill segments. In both cases, we find that employment related to these occupations became increasingly concentrated in firms specializing in these activities, and was less likely to be performed in-house within firms specialized in other activities. As a result, after the arrival of broadband internet, establishments become increasingly homogeneous in their occupational composition. Finally, we provide suggestive evidence that high-skill workers experience salary gains from being outsourced, while low-skill workers lose out.
    Keywords: broadband; firm organization; labor market; outsourcing
    JEL: G14 G21 O33
    Date: 2021–07–28
  3. By: Berg, Holger; Kulinna, Raik; Stöcker, Carsten; Guth-Orlowski, Susanne; Thiermann, Ricky; Porepp, Natalie
    Abstract: This paper analyses the potential of digital information technology to enable the reliable provision of product information along the plastics supply chain. The authors investigate the possible contribution of a product passport equipped with decentralised identifiers and verifiable credentials to overcome information deficits and information asymmetry in the circular plastics economy. Through this, high-quality plastics recycling could be enabled on a larger scale than currently possible.
    Date: 2022
  4. By: Fabienne Kiener; Christian Eggenberger; Uschi Backes-Gellner
    Abstract: We study how information technology (IT) progress affects returns to specialization and social skills by developing a theoretical model and empirically analyzing its implications. Our model shows how IT progress can lead to increasing returns to specialization and social skills. Using rich skill data from Swiss occupational training curricula, we empirically investigate the wage returns to specialization and social skills depending on IT progress in different industries. Our individual fixed-effects analyses show that IT progress leads to increasing wage returns for specialized workers. Furthermore, our results suggest that workers with high shares of social skills benefit from IT progress only if they are also specialized.
    Keywords: digitalization, IT progress, skills, education, human capital
    JEL: I26 J24 O33
    Date: 2022–04
  5. By: G.K., Chetan Kumar; K.B., Rangappa; S., Suchitra
    Abstract: In modern world, technology plays a very important role in enhancing learning outcome among students. Many research studies undertaken in the developed world have outlined the importance of technology in enhancing learning outcomes. Noting the same, Indian states like Karnataka, Uttar Pradesh etc. have resorted to provide digital devices to their students with the hope of enhancing their learning outcomes. In this context, it becomes all the more relevant to analyze the socio economic and academic factors influencing use of technology among students. This study analyses the factors affecting use of digital devices and their effectiveness in enhancing their learning outcomes among rural students. The study covered 4 districts, comprising a sample size of 465 respondents to assist in optimum policy formulation for rural students in developing world.
    Keywords: : Technology in Learning, Learning Outcomes, Digital Devices, Rural Students, Socio-economic factors
    JEL: A23 C1 C3 C31 C5 I2 I21 I28
    Date: 2022–01–01
  6. By: Joël Cariolle (FERDI - Fondation pour les Etudes et Recherches sur le Développement International); Yasmine Elkhateeb (CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, Cairo University); Mathilde Maurel (CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, CNRS - Centre National de la Recherche Scientifique, FERDI - Fondation pour les Etudes et Recherches sur le Développement International)
    Abstract: This paper investigates the impact of internet use as a means of accessing news on African citizens' demand for and perception of the supply of democracy. This question is addressed using cross-sectional data from the last three rounds of the Afrobarometer survey for a sample of 25 African countries between 2011 and 2018. Using an instrumental variable approach to control for the possible endogeneity bias between internet use and citizens' perceptions, we found that using the internet to get news has a negative and significant effect on the demand for and on the perceived supply of democracy. The negative effect is channeled through two main factors. The first factor is the confidence in governments and governmental institutions, which is undermined by the use of the internet. In particular, we find that this internet-induced lower confidence translates into a higher probability of engaging in street protests instead of increased political participation. The second driving factor is the (mis-)information channel. On the one hand, we show that internet users' perception of the supply of democracy negatively diverges from experts' ratings. On the other hand, we document further that internet use increases the likelihood of incoherence in the respondent's stance about her demand for democracy. Finally, we show that the negative effect we found is mitigated when the internet is complemented by traditional media sources, especially the radio, to get informed. The findings of this study suggest that internet use is not neutral and tends to undermine citizens' preferences for democracy and alter perceptions about the functioning of political institutions.
    Keywords: Internet news,democracy,Africa
    Date: 2022–03
  7. By: Aleksandra Parteka (Gdansk University of Technology, Gdansk, Poland); Aleksandra Kordalska (Gdansk University of Technology, Gdansk, Poland)
    Abstract: In this paper we analyse the effects of technological innovation in the artificial intelligence (AI) domain on productivity. We embed the recently released data on patents and publications related to AI into an augmented panel model of productivity growth, estimated for OECD countries, and compared to a non-OECD sample. Our instrumental variables' estimates, accounting for AI endogeneity, provide evidence in favour of the modern (AI) productivity paradox. We show that the development of AI technologies remains a niche innovation phenomenon with a negligible role in the officially recorded productivity growth process. This general result, i.e. the lack of a strong relationship between AI and productivity growth, is robust to changes in the country sample, in the way we quantify labour productivity or the creation of AI technology, in the specification of the empirical model (control variables) or in estimation methods.
    Keywords: technological innovation, productivity paradox, productivity growth, artificial intelligence, patents
    JEL: O33 O47
    Date: 2022–01
  8. By: Jean-Christophe Poudou (MRE - Montpellier Recherche en Economie - UM - Université de Montpellier); Wilfried Sand-Zantman (ESSEC Business School and THEMA (UMR 8184) - Economics Department - Essec Business School - THEMA - Théorie économique, modélisation et applications - CNRS - Centre National de la Recherche Scientifique - CY - CY Cergy Paris Université)
    Abstract: We address the need to regulate Internet infrastructure usage to take into account environmental externalities. We model the interactions between a monopoly ISP and different types of content providers in settings where the former chooses the network size and the latter influences congestion on the network. We first show that current net neutrality regulation does not provide agents the right incentives to cope with the environmental externality issue. Then, we study several alternatives, including laissez-faire, price-based regulation, and norm-based regulation. We derive conditions under which these alternatives fare better than net neutrality. In particular, the two types of regulations are useful tools to accommodate consumer interest and environmental concerns.
    Date: 2022–03–15
  9. By: SULIS Patrizia (European Commission - JRC); VANDECASTEELE Ine (European Commission - JRC); HALMOS Andrea; NI EARCAIN Noirin; MAISTRALI Antigoni (European Commission - JRC); AURAMBOUT Jean-Philippe (European Commission - JRC); LAVALLE Carlo (European Commission - JRC)
    Abstract: Digital technologies and innovative solutions can act as critical enablers in enhancing services and contribute to improving the urban environment and the overall quality of life of its citizens. Cities and communities should implement interoperable solutions, based on existing open standards and technical specifications, to avoid vendor-lock in, benefit from cross-domain, integrated services and infrastructures, reduce costs, and scale up successful projects. Efforts should be made to increase resources and improve capacity and skills around data management as well as in the use of innovation procurement. The introduction of new services and technology applications can create or increase disparities in terms of the digital and social divide in relation to age, gender, economic status, etc. Public bodies at local, national and EU level need to introduce appropriate measures to prepare for the possible consequences of digital innovation in cities.
    Keywords: smart cities, digital age, human-centric AI, data strategy
    Date: 2022–03
  10. By: Janos Ferencz; Javier López González; Irene Oliván García
    Abstract: Artificial intelligence (AI) has strong potential to spur innovation, help firms create new value from data, and reduce trade costs. Growing interest in the economic and societal impacts of AI has also prompted interest in the trade implications of this new technology. While AI technologies have the potential to fundamentally change trade and international business models, trade itself can also be an important mechanism through which countries and firms access the inputs needed to build AI systems, whether goods, services, people or data, and through which they can deploy AI solutions globally. This paper explores the interlinkages between AI technologies and international trade and outlines key trade policy considerations for policy makers seeking to harness the full potential of AI technologies.
    Keywords: Data flows, Digital trade, Innovations, Regional Trade Agreements, Trade policy
    JEL: F13 F14 O33
    Date: 2022–04–22
  11. By: Daron Acemoglu; Gary Anderson; David Beede; Catherine Buffington; Eric Childress; Emin Dinlersoz; Lucia Foster; Nathan Goldschlag; John Haltiwanger; Zachary Kroff; Pascual Restrepo; Nikolas Zolas
    Abstract: This paper provides a comprehensive description of the adoption of automation technologies by US firms across all economic sectors by leveraging a new module introduced in the Census Bureau’s 2019 Annual Business Survey. The module collects data from over 300,000 firms on the use of five advanced technologies: AI, robotics, dedicated equipment, specialized software, and cloud computing. We document that the adoption of these technologies remains low (especially for AI and robotics), varies substantially across industries, and concentrates on large and younger firms. However, because larger firms are much more likely to adopt them, 12-64% of US workers and 22-72% of manufacturing workers are exposed to these technologies. Firms report a variety of motivations for adoption, including automating tasks previously performed by labor. Consistent with the use of these technologies for automation, adopters have higher labor productivity and wages and lower labor shares. In particular, the use of these technologies is associated with a 15% increase in labor productivity, which accounts for 20–30% of the higher labor productivity achieved by the largest firms in an industry. Adopters report that these technologies raised skill requirements and led to greater demand for skilled labor, but brought limited or ambiguous effects to their employment levels.
    Date: 2022–04
  12. By: Emara, Noha; Zecheru, Daniela
    Abstract: The impact of major macroeconomic factors on domestic inflation has long been theorized and analyzed by economists. Nevertheless, the literature that studies the impact of digitization as an important determinant for lower and more stable inflation in both advanced economies and emerging markets is very thin. In this paper, we use panel data from the World Bank World Development Indicators and the Digital Ecosystem Development Index developed by Katz and Callorda (2018), on a sample of 54 advanced economies and emerging markets over the period 2004-2018. Starting from a traditional Phillips Curve with inflation expectations and output gap, we estimate a System Generalized Method of Moments (GMM) panel model. In our estimation of the model, we find a negative statistically significant non-linear (quadratic) relationship between the domestic inflation rate and the digitization index, with a definite cutoff point. This result supports the hypothesis that digitization may initially lower inflation, however, once digitization reaches its cutoff level further improvement in digitization leads to an increase in the rate of inflation. We subsequently re-estimate the main model using eight specific digitization pillars for infrastructure of digital services, digital connectivity, digitization of household, digitization of production, digital industries, factors of digital production, digital competitive intensity, and regulatory framework and public policies. Notably, we find a negative statistically significant non-linear relationship between the domestic inflation rate and all eight pillars of digitization for both the full sample and the emerging markets sample. Because the highest deflationary impact of digitization is derived from the digital infrastructure and factors of digital production, the policy priorities we emphasize include expanding network coverage, increasing fixed and broadband download speed, boosting telecommunications and education investments, as well as strengthening intellectual property rights, enhancing investments in R&D, and incentivizing innovation and patenting. However, our results show that deflationary effects of the improvement in digitization are smaller in emerging markets versus the full sample and that the entire effect of digitization in emerging markets is reinforced by the investment in human capital and the improvement of governance. Hence, our policy recommendations for emerging markets are directed towards maximizing school enrollments, controlling corruption, rule of law, and voice and accountability measures to recoup the maximum benefits of the improvement in digitization on domestic inflation.
    Keywords: Digitization; System GMM; Advanced Economies; Emerging Markets
    JEL: C23 G21 O47
    Date: 2022–02–09

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