Demand for Information and Communication Technology-Based Services and Regional Economic Development

Eduardo Anselmo de Castro, Christopher Nigel Jensen-Butler

    Research output: Contribution to journalArticlepeer-review

    14 Citations (Scopus)

    Abstract

    The relationship between the uptake of Information and Communication Technology-based services (ICT) and regional economic development is examined here; we address in particular the idea that ICT will promote regional economic convergence. We argue that ICT can generate contradictory trends of regional convergence and divergence and that, under conditions of non-regulated market supply, the effects leading to divergence can be dominant. The approach is based on the development of a regional demand model, which is the combination of two sub models, one dealing with the effects of network externalities and the other based on the concept of potential demand for ICT. The main conclusion is that less populous, more peripheral and poorer regions with weaker existing social and economic networking will encounter problems of insufficient demand. This in turn will delay the launch of new services and slow the rate of uptake. Negative dynamic effects of low ICT use on economic performance will generate a vicious circle of cumulative disadvantage.

    Original languageEnglish
    Pages (from-to)27-50
    Number of pages24
    JournalPapers in Regional Science
    Volume82
    Issue number1
    DOIs
    Publication statusPublished - Jan 2003

    Keywords

    • information and communication technology
    • demand modelling
    • network externalities
    • regional economic convergence
    • NETWORK EXTERNALITIES
    • TELECOMMUNICATIONS INFRASTRUCTURE
    • PERIPHERAL REGIONS
    • COMPETITION
    • ADOPTION
    • GROWTH
    • EUROPE
    • COUNTRIES
    • DIFFUSION
    • POLICY

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