The OECD Growth Study concluded that information and communications technology (ICT) is a key input to productivity and growth performance. This series of peer reviews on ICT diffusion to business, undertaken by the Working Party on the Information Economy, responds to the OECD Council Ministerial request for the OECD to increase its monitoring of member countries’ implementation of the Growth Study recommendations. The following reports review the status of diffusion of ICT to business in the respective countries and describe current and previous policies aimed at ICT uptake in firms.
Reports are currently available on Austria, Denmark, Finland, Italy, Korea, Mexico, Norway Switzerland and the Netherlands. A study of the Indian ICT sector, its contribution to growth and policy suggestions has also been published.
Brief abstracts and links to downloads of each peer review can be found below.
Mexico has made good progress in modernising its economy and has started to successfully address structural problems including poverty and low levels of human capital. GDP growth is very encouraging, coupled with low inflation and federal deficits and strong export performance. Social security benefits have been extended to the very poor, primary school coverage is almost universal, and promising reforms have been undertaken in citizen services and improving government transparency. The challenge for Mexico is to take advantage of the very favourable macroeconomic environment to improve productivity performance and raise living standards across the board and tackle the large informal job market. ICTs can play an important part in achieving goals by improving economic performance and increasing competitiveness. Programmes such as e-Mexico which combine infrastructure development with citizen services are very popular and are a further step in the right direction. Other programmes, including skills development and support for indigenous firms (PROSOFT, Fondo PyME), should be strengthened and further focused to improve efficiency and extend reach to businesses. Better overall planning and priority-setting is needed to provide continuity in programmes beyond a particular administration and to prioritise initiatives where they can give the greatest impacts.
Austria is in the middle group of OECD countries in terms of most indicators of information and communication technology (ICT) infrastructure for business. E-readiness and Internet penetration are around average, broadband is widely available even if lagging in rural areas, business R&D growing, Internet banking and e-government applications advanced, although aggregate ICT and knowledge investments are below average. E-government is well-developed and is a good example of a policy lever which has important impacts on business and citizens as well as improving government efficiency. Similarly, electronic payments and electronic signatures are well developed although e-commerce performance is only average. ICT policy has aimed to sustain relatively good economic performance and modernise the economy by tackling market distortions and market failures. This has included broad liberalisation of network services, increased direct public funding and incentives to private spending on R&D, and initiatives for ICT skills and diffusion. However, co-ordination is a complex and challenging task in a federal government structure and does not necessarily lead to a centralised approach to ICT policy and its direction and form. Informal information exchange and programme evaluation practice may be insufficient to identify and meet emerging challenges, and recent transparent initiatives such as the White Paper on ICT-related strategy should be continued and strengthened.
has a good ICT infrastructure, consistent market-led policy stance, and a cautious budget policy, which should provide a stable framework for more focused ICT policies. The OECD review
of the Netherlands recommends that to accelerate diffusion policies need to: increase their emphasis on strengthening ICT entrepreneurship and improving human capital and pay increasing attention to ICT skills; foster ICT-related R&D and improve research-industry links; further develop initiatives to improve business information and advisory services for SMEs, particularly more complex e-business applications; strengthen recent efforts to increase policy transparency and undertake systematic policy evaluation; and should re-assess the public sector role and priority given to digital content creation and use.
has a very good telecommunication infrastructure and ICT is widely diffused to both businesses and citizens. The government aims to strengthen Denmark as a knowledge society and the importance of ICT in reaching this goal is acknowledged by the government. The overall policy approach to the field of ICT is that developments primarily must take place on private initiative and on market terms. The role of the public authorities is to remove market failures and create the best framework for business and citizens. High priority is given to education and research in the ICT area and policy is innovative in specific areas such as e-government and digital signatures. However the business structure with a high proportion of small and medium sized firms is a challenge for the policy making. Building on the strengths in the field of ICT, the report recommends increased priority being attached to setting quantitative policy goals, promoting common standards, improving the supply of venture capital, increasing focus on service industries, and improving evaluation.
is well into the diffusion stage of the S-curve of ICT use in business (cf. OECD Information Technology Outlook 2004
, 2002). Levels of basic ICT “readiness” in business are well above the OECD average and ICT investment both in equipment and ICT skills remains high. However, good past performance may hide some problem areas such as significant sectoral differences in ICT related productivity and slow penetration of e.g. new wireless technologies in business use.
: The structural characteristics of the Italian economy have a major role in shaping policies for ICT diffusion to Italian businesses. The level and speed of diffusion of new technologies are determined by the sectoral distribution of industry, the small size of businesses, and major regional variations in industry structure and resources. Overall, the telecommunications infrastructure is good, the growth of the Internet and broadband has picked up and computerisation is spreading despite the recent poor economic performance and government budget constraints. There are however a range of constraints int he business environment and on policies to enhance diffusion of ICTs to business and improve business performance.
is facing the challenges of moving from high levels of new ICT infrastructure availability to ensuring effective use and reaping the economic benefits from ICT diffusion to business. It has had very high rates of growth and labour productivity growth, led by manufacturing, and most recently by R&D-intensive manufacturing and has high levels of R&D in ICT industries. In terms of ICT diffusion across the economy, levels of basic ICT “readiness” in telecommunications and PCs are around the OECD average, although it is clearly the world leader in broadband infrastructure and has high levels of consumer use. However business diffusion appears uneven despite rapid progress, ICT investment and use remain around the OECD average in general, and ICT impacts on business may be lower than expected. This is partly due to the size distribution of Korean business, with small and very small establishments making up a very high share of total establishments and employing around one-third of total workers. Less than one half of small businesses had a computer and Internet access, and even when equipped the smallest often did not use them in business operations and processes. Small businesses are not fully exploiting the advanced broadband environment, for reasons including awareness, lack of skilled personnel and lack of specialist services.
: Norway has a good track record in investing in ICT and widely adopting and using ICT and has developed niche expertise and firms often directly or indirectly linked with the dominant offshore, maritime, construction and infrastructure sectors. It has a consistent market-led policy stance and cautious budget policy that ideally would provide a stable framework for more focused ICT policies. High priority is given to education and a cost-effective public sector, and there is continuing policy concern regarding the need to shift to a knowledge-intensive economy after oil and gas resources are exhausted. However, full use of ICT in business lags particularly in broad sections of manufacturing, and there is evidence that implementation of modern ICT is slower than in neighbouring Nordic countries, that there is a lower degree of innovativeness in industry and that specific skills to develop e-business are not sufficient.
is well-advanced along the diffusion curve of ICT use in business. Levels of basic “readiness” (see OECD Information Technology Outlook 2004
, 2002) are high, and it is well equipped with the necessary hardware, both information technology and communications technology. However diffusion is uneven and ICT impacts on business may be lower than expected based on the average levels of equipment and diffusion. Switzerland tends to be a follower in embracing fully new technologies and their application to business rather than an early adopter despite the strong technology base. This raises the question of whether business in Switzerland makes the best use of the technologies not only in terms of introducing the hardware but re-engineering processes and business models to take full advantage of the technologies. Given the relatively lower penetration of PCs in schools and homes, there may be bottlenecks in terms of skills and familiarity with ICT that could become impediments to the effective adoption of ICT in business. The federal government's industry policies generally tend to focus on setting the right framework through improved information flow, streamlined procedures and demonstration programmes. In this context, the next steps in policy could be to develop a better picture of shared goals, obstacles and measures needed to improve performance.