Publication: The Diffusion of the Internet : A Cross-Country Analysis
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Published
2010
ISSN
03085961
Date
2012-03-30
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This paper analyzes the process of Internet diffusion across the world using a panel of 214 countries during the period 1990-2004. Countries are classified as low- or high-income and it is shown that the diffusion process is characterized by a different S-shaped curve in each group. The estimated diffusion curves provide evidence of very slow "catching up". The paper also explores the determinants of Internet diffusion and shows that network effects are crucial to explain this process. One important finding is that the degree of competition in the provision of the Internet contributes positively to its diffusion.
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Publication Diffusion of the Internet : A Cross-Country Analysis(World Bank, Washington, DC, 2007-12)This paper analyzes the process of Internet diffusion across the world using a panel of 199 countries during 1990-2004. The authors group countries in two categories-low and high-income countries-and show that the Internet diffusion process is well characterized by an S-shape curve for both groups. Low-income countries display a steeper diffusion curve that is equivalent to a right shift of the diffusion curve for high-income countries. The estimated diffusion curves provide evidence of a "catching-up" process, although a very slow one. The paper explores the determinants of Internet diffusion at the country level and across the same income groups. The most novel finding is that network effects seem to be crucial-the number of Internet users in a country in a given year is positively associated with the number of users in the previous year. The findings also show that the degree of competition in the provision of Internet service contributes positively to its diffusion, and there are significant positive language externalities.Publication Leapfrogging? India's Information Technology Industry and the Internet(Washington, DC: World Bank and the International Finance Corporation, 2001-05)The Internet has been seen by numerous observers, as a set of technologies that might enable developing countries to "leapfrog" over the development path, taken by industrial countries, enabling poorer countries to increase their rates of growth, and "catch up" sooner. Using India as a case study, this paper reviews the degree to which that promise might be realized. The paper concludes that while internet development in India is still at a very early stage in terms of numbers of connections, and overall use, the promise it offers for increased productivity, and economic growth, is likely to be significant. Most benefits are likely to come from business use of the internet for both internal control, and for dealing with business customers, not from customer use. In particular, global connections will be much enhanced by India's liberalized access to international internet gateways, and to privately-provided undersea cable access. This access alone could offer Indian companies, business opportunities that otherwise would flow to other, better connected Asian competitors. However, poor infrastructure, along with low public investment, remains a difficult problem to overcome. And, although technical education has been a bright spot, India's overall educational attainment is low in demographic terms, and illiteracy will critically limit "leapfrogging" the anticipated expansion of the internet. Rather, economic growth depends on complementary interactions between the private sector, and the government's adequate provision of public goods.Publication Infrastructure, Competition Regimes, and Air Transport Costs: Cross-Country Evidence(World Bank, Washington, D.C., 2004-07)The relevance of transport costs has increased as liberalization continues to reduce artificial barriers to trade. Countries need to adopt policies to get closer to global markets. Can improvements in infrastructure and regulation reduce transport costs? Is it worthwhile to implement policies designed to increase competition in transport markets? Focusing on air transport, which has increased its share in US imports from 24 percent in 1990 to 35 percent in 2000, this paper quantifies the effects of infrastructure, regulatory quality and liberalization of air cargo markets on transport costs. During the 1990s, the United States implemented a series of Open Skies Agreements, providing a unique opportunity to assess the effect that a change in the competition regime has on prices. We find that infrastructure, quality of regulation and competition matter. In our sample, an improvement in airport infrastructure from the 25th to 75th percentiles reduces air transport costs by 15 percent. A similar improvement in the quality of regulation reduces air transport costs by 14 percent. Open Skies Agreements further reduce air transport costs by 8 percent.Publication Regulation and Internet Use in Developing Countries(World Bank, Washington, DC, 2003-03)Policymakers are simultaneously concerned about the consequences of a worsening "digital divide" between rich and poor countries and hopeful that information and computing technologies could increase economic growth in developing countries. But very little research has explored the reasons for the digital divide beyond noting that it is strongly correlated with standard development indicators, and no empirical research has explored the role of regulation. The author uses data from a unique new survey of telecommunications regulators and other sources to measure the effects of regulation in Internet development. He finds regulation strongly correlated with lower Internet penetration and higher Internet access charges. More specifically, controlling for factors such as income, development of the telecommunications infrastructure, ubiquity of personal computers, and time trends, countries that require formal regulatory approval for Internet service providers (ISPs) to begin operations have fewer Internet users and Internet hosts than countries that do not require such approval. Moreover, countries that regulate ISP final-user prices have higher Internet access prices than countries that do not have such regulations. These results suggest that developing countries' own regulatory policies can have large impacts on the digital divide.Publication Information and Communication Technologies and Broad-Based Development : A Partial Review of the Evidence(Washington, DC: World Bank, 2003-12)Information and communication technologies (ICTs) are increasingly seen as integral to the development process. This paper reviews some of the evidence for the link between telecommunications and the Internet and economic growth, the likely impact of the new ICTs on income inequality and anecdotal evidence regarding the role of the Internet in improving government services and governance. It looks at methods to maximize access to the new ICTs, and improve their development impact both in promoting income generation and the provision of quality services.
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