Firm-Level Adoption of Technologies in Senegal

Abstract

Technology is key to boost productivity and generate more and better quality jobs in Senegal. This paper uses a novel approach to measure technology adoption at the firm level and applies it to a representative sample of firms in Senegal. It provides new measures of technology adoption at the firm level, which identify the purposes for which technologies are used and analyzes some of the key barriers to improving technology adoption at the firm level in Senegal. First, the adoption of general-purpose information and communications technologies, such as computers, the internet, and cloud computing for business purpose, is low but very heterogeneous and positively associated with size and formal status. Second, most firms still rely on pre-digital technologies to perform general business functions, such as business administration, production planning, supply chain management, marketing, sales, and payment. Third, most firms, including large and formal firms, still rely on manual methods or manually operated machines to perform critical pro duction tasks that are sector specific, such as harvesting in agriculture or packaging in food processing. The paper presents evidence of three main challenges to improve technology adoption: access to finance, information, and knowledge (firm capabilities), and access to markets and competition.