Telecommunications productivity, catch-up and innovation

Abstract

This study examines telecommunications productivity, technological catch-up and innovation in 74 countries for the period 1991-1995. A summary of partial productivity indicators is presented, and total factor productivity (TFP) growth is calculated using the Malmquist productivity change index. Decomposition of the Malmquist index provides preliminary evidence that developing countries can enhance productivity through catch-up. An econometric model is estimated that relates innovation to market size and two measures of market structure, viz., market concentration and private ownership. Model estimates support the Schumpeterian hypothesis that market size is conducive to innovation. However, the hypothesis that concentration (the dominant carrier's share of international message telephone service (IMTS) traffic) is positively related to innovation is rejected. Finally, the model suggests that increased private ownership of the dominant local-exchange carrier can enhance innovation.

Regulation, Competition and Productivity Growth in the African Telecommunications Industry

“…Finally, most African economies were characterized by weak institutions, also subsidized and unprofitable state-owned enterprises which were detrimental to the development of the telecommunication sector [5]. Thus, the African telecommunications industry was comparatively inefficient [2], serving only a small part of the population residing in cities.…”

“…As explained in Section 1; both Madden et al [2] and Lam et al [3] had included African countries in their analysis at a global level, however, their results on productivity growth of African countries showed opposite developments. While the former showed that productivity in the African telecommunications industry had declined by 3.7% per annum from 1990 to 1995, the later found that productivity had grown at an annual rate of 6.8% from 1980 and 2006.…”

“…From the literature review, previous studies have used different combinations of input and output variables, mainly based on the relevance and availability of data. In case of input variables, for instance Giokas et al [16] and Madden et al [2] used total telecom staffs as a proxy for labor; and access lines and number of Internet hosts as proxies for capital. Due to the evolution of the telecommunications sector, capital expenditure is not only limited to fixed lines but also to spectrum acquisition, mobile network infrastructure as well as fixed data networks such as fiber optic cables.…”

“…Madden et al [2] examined the productivity growth in global setting, including African countries and found that productivity in the African telecommunication sector had declined at 3.7% annually from 1991 to 1995. In contrast, Lam et al [3] have recently investigated the productivity growth of 105 countries between 1980 and 2006 and they found that productivity in the Africa telecommunication sector had grown at 6.8%, close to the global sample of 6.7%.…”

Investigating the Impact of Investments in Telecoms on Microeconomic Outcomes: Conceptual Framework and Empirical Investigation in the Context of Transition Economies

“…Consequently, findings in the context of TEs may be better generalized beyond the small group of highly developed countries. This is especially important for the purposes of framework building and validation, for it was previously noted that the insights reporting the overall positive effects of investments in ICT (OECD, 2005a,b,c;IMF, 2001;Samoilenko & Osei-Bryson, 2008a,b) in the context of the relatively homogenous developed countries (Lam & Lam, 2005;Madden & Savage, 1999;Dunne et al, 2004;Siegel, 1997) might not be applicable to a more diverse environment of emerging, developing and transition economies (Roztocki & Weistroffer, 2008;Hoskisson et al, 2000).…”