Matteo Grazzi

ICT in developing countries: Are language barriers relevant? Evidence from Paraguay

We investigate the role of language barriers on both computer adoption and Internet connection in Paraguay, a country in which about 40% of the population is monolingual in Guarani, 50% bilingual and 6% monolingual in Spanish. Our empirical results show that the ICT diffusion process is highly heterogeneous, reflecting pre-existing inequalities in other socioeconomic dimensions. Parametric estimations also suggest that the Guarani language constitutes an important cultural barrier to the ICT diffusion in the country. This situation illustrates the cultural barriers that developing countries may face in using ICT.

What Drives ICT Diffusion in Developing Countries? Evidence from Paraguay

The diffusion of Information and Communication Technologies (ICTs) has been identified by international policy-makers and schol ars as an important driver for economic development. In this perspective, research on the determinants of technology adoption appears particularly relevant. However, while the empirical literature on ICT adoption in workplace is relative ly abundant, few studies have been elaborated on their penetration in households. Addi tionally, academic work has focused on industrialized countries and it is still missing a comprehensive analysis on developing world. In this paper we contribute to fill this gap, evaluating the main socio-economic determinants of the presence of computer and Internet connection in Paraguayan households. Non-parametric statistics sh ow that Paraguay has relatively low levels of ICT penetration. Moreover, technology diffusion follows a heterogeneous pattern, reflecting pre-existing ineq ualities in other socio-economic dimensions. Econometrically, we model the probability that a ho usehold has or has not adopted computer technologies and Internet acce ss. The results confirm that conventional variables such as income and education are key determinants of ICT diffusion, but there is also evidence of the presen ce of geographical network effects and of complementarities between Internet use at di fferent locations.

Internet in Latin America: who uses it? ... and for what?

The diffusion of the Internet is becoming a central policy issue for developing countries, being identified by scholars as a key driver of knowledge, innovation and development. Remarkably, the related literature is scarce and fragmented. In order to contribute to fill this gap, we analyse Internet access and usage patterns in seven Latin American countries. In addition to the traditional socio-economic determinants of Internet access, the results also suggest an important role for network effects, presence of students at households and complementarities in Internet use at different locations. Concerning usage, estimations show that Internet access does not translate automatically into usage. In particular, females are found to be less likely to use the Internet, even once access is provided. Finally, the evidence suggests that while technological skills are necessary to fully exploit Internet potentialities, individuals located in rural areas are more likely to use the Internet for education purposes, confirming the potential connectivity impact on human capital.

Firm Innovation and Productivity in Latin America and the Caribbean

The full version of this book compiles several empirical works that, through different lenses, aim to reveal which variables may have a systematic effect on the productivity evolution observed at a firm and sectorial level in LAC countries. The book emphasizes knowledge generation, diffusion, and implementation mainly through innovation, while exploring the roles of human capital, financial resources, and linkages that also shape firm inspiration.

Determinants of Enterprise Performance in Latin America and the Caribbean: What Does the Micro-Evidence Tell Us?

Over the last half-century, per capita income in Latin America has stagnated relative to the United States and other benchmarking countries. Growth accounting techniques reveal that slow productivity growth is at the root of this weak performance, calling for detailed analyses and appropriate and timely policy responses. In addition to macroeconomic and regulatory factors, productivity depends crucially on microeconomic aspects and on the specific strategies and decisions of individual firms, though such microeconomic decisions have been seldom studied in a quantitative and comparative manner. This chapter focuses on this issue, highlighting the presence of heterogeneity across firms in the region and introducing the specific analysis of the drivers of this heterogeneity which is contained in the following chapters.

ICT access in Latin America. evidence from household level

The diffusion of Information and Communication Technologies (ICTs) is becoming a central policy issue for developing countries, being identified by international policy-makers and scholars as an important driver of knowledge, innovation and economic growth. We analyze ICT access patterns in seven Latin American countries. In particular, we study the socio-economic determinants of the presence of computers and Internet connection at household level. Descriptive data show that ICT diffusion is concentrated in narrowly defined segments of income and educational groups in each country. Across countries, there is also evidence that the lower is the ICT diffusion, the higher is the inequality of that diffusion. Econometrically, we model the probability that a household has or has not adopted computer technologies and Internet access. The results confirm that variables such as income, education and rural/urban areas are key determinants of ICT diffusion. Additionally, there is evidence of geographical network effects and complementarities between Internet uses at different locations.

Internet Use and Public Programs Participation: Evidence from Chile

The interest for ICT-related issues has notably increased in the last decades, leading to a flourishing of studies on their impact on many dimensions. Despite the consensus about the importance of ICT effects at micro level, there is lack of analysis on the existence, magnitude and direction of these effects. This article aims to contribute to the literature by performing an analysis of the relationship between Internet use and information diffusion at household level in Chile. By using data from National Household Surveys, we estimate the effect of Internet use at household level on the probability of obtaining a scholarship for young students in the household. The results suggest that ICT use is significantly and positively correlated with the probability of primary students to be granted by a scholarship program, illustrating how ICT improves communication access and participation in social programs. Given that ICT diffusion is largely determined by socio-economic dimensions, the results also illustrate how ICT could reinforce pre-existing inequalities. This highlights the need for proactive public policies in addressing the digital divide.

E-Commerce and Productivity: Evidence from Chile

The diffusion of e-commerce is deeply changing the way in which business is conducted, by reducing the costs of goods and services to be used in the productive process as inputs and by increasing the access to new markets. However, the relative empirical literature is still limited, and the majority of studies focus on manufacturing firms in developed countries. This paper makes use of a country-representative survey including information for Chilean firms of every size and sector to analyze the impact on firm productivity of e-commerce adoption in the context of a middle-income economy. The results show that e-commerce is associated with higher levels of productivity in both the manufacturing and the service sector, whereas e-buying is the channel that explains this relationship.

Innovation and Productivity in Latin American and Caribbean Firms: Conclusions

This chapter summarizes the main results of the book, presenting new evidence on the factors preventing faster productivity growth in Latin America and the Caribbean. Innovation significantly influences the productivity of firms, although to different degrees depending on their characteristics. The evidence confirms that the impact of innovation on productivity depends also on additional complementary assets, such as access and use of ICT and on-the-job training. These conclusions also hold true for the Caribbean economies, traditionally understudied. Additional factors that can influence productivity have also been detected, such as the age of firms, their access to credit and finance, and their participation in international markets and global value chains. On the basis of this evidence, we suggest that achieving efficiency improvements within firms requires detailed microeconomic policies that directly address these factors.

Information and Communication Technologies, Innovation, and Productivity: Evidence from Firms in Latin America and the Caribbean

It is generally recognized that information and communication technologies (ICTs) have radically changed how modern business is conducted, benefitting firm performances through several channels, such as increasing the efficiency of internal processes, expanding market reach or increasing innovation. Using data from the World Bank Enterprise Survey, this chapter contributes to the existing literature by identifying the drivers of ICT diffusion in LAC firms and assessing the relationship between ICTs and firm performance in the region. Our results show that larger, older, skill-intensive, exporter, and urban firms are more likely to adopt ICTs. However, once adopted, size and location lose importance. Additionally, there is a positive relationship between broadband and firm performance. Firms that have adopted broadband increase their probability of innovating, and those that use it intensively are found to receive an additional positive effect. Further estimations also provide evidence on the fact that broadband adoption and use increase firm productivity.