Convergence or Divergence - The Impact of Technology

This paper presents an overview and assessment of the theoretical and empirical work on catch-up and growth, with particular emphasis on the impact of technology, and the consequences for developing countries. The point of departure is the neoclassical theory of economic growth, as laid out by Solow and other in the 1950s, and the applied work that followed ("growth accounting"). Then the contributions from economic historians and more heterodox economists, such as Schumpeter, Kaldor and others, are discussed, followed by an account of the most recent theoretical developments in this area ("new growth theory"). Finally an assessment is made of the lessons from the recent surge in empirical (econometric) work in this area.

The emergence of the mobile internet in Japan and the UK: platforms, exchange models, and innovation 1999‐2011

In 1999 Japanese mobile operator NTT DoCoMo launched arguably the world’s first successful mobile Internet services portal called “i‐mode”. In Europe at the same time a series of failures diminished the opportunities to attract customers to the mobile Internet. Even though similar Internet technologies were available in Japan and the UK, very different markets for services developed during the initial years 1999‐2003. When the West expected Japanese firms to become dominant players in the mobile digitalisation of services during the introduction of 3G networks, it remained instead a national affair. The dominant views of how markets for mobile services operated seemed flawed.   So‐called delivery platforms were used to connect mobile phones with service contents that were often adapted from the PC world. Designing and operating service delivery platforms became a new niche market. It held a pivotal role for the output of services and competition among providers.   This thesis sets out to answer a set of inter‐related questions: How and where did firms innovate in this new and growing part of the service economy and how are new business models mediated by service delivery platforms? It argues that innovation in the digitalised economy is largely influenced by firms achieving platform leadership through coordination of both technological systems and the creation of multi‐sided exchanges. This thesis demonstrates from cases of multi‐sided markets in operator‐controlled portals, of mobile video and TV and of event ticketing in Japan and the UK that defining the scope of the firm on the network level forms the basis for incremental innovation, the dominant form of service innovation. A parallel focus on coordinating platform technology choices forms the basis for firms to trade fees, advertisements, and user data, enabling control over profitable parts of multi‐sided value networks

Saving, investment, government finance and the current account: The Dutch experience

Economic Policy;Current Account

Remittance flows to post-conflict states: perspectives on human security and development

This repository item contains a single issue of the Pardee Center Task Force Reports, a publication series that began publishing in 2009 by the Boston University Frederick S. Pardee Center for the Study of the Longer-Range Future.Migrant remittances – that is, money or other goods sent to relatives in the country of origin– play an increasingly central role in post-conflict reconstruction and national development of conflict-affected states. Private remittances are of central importance for restoring stability and enhancing human security in post-conflict countries. Yet the dynamics of conflict-induced remittance flows and the possibilities of leveraging remittances for post-conflict development have been sparsely researched to date. This Pardee Center Task Force Report is the outcome of an interdisciplinary research project organized by the Boston University Center for Finance, Law & Policy, in collaboration with The Frederick S. Pardee Center for the Study of the Longer-Range Future. The Task Force was convened by Boston University development economist John R. Harris and international banking expert Donald F. Terry, and social anthropologist Daivi Rodima-Taylor, Visiting Researcher at the Boston University African Studies Center, served as lead researcher and editor for the report. The Task Force was asked to research, analyze, and propose policy recommendations regarding the role of remittances in post-conflict environments and their potential to serve as a major source of development funds. The report’s authors collectively suggest a broader approach to remittance institutions that provides flexibility to adapt to specific local practices and to make broader institutional connections in an era of growing population displacement and expanding human and capital flows. Conditions for more productive use of migrants’ remittances are analyzed while drawing upon case studies from post-conflict countries in Africa, Asia and Latin America. The papers in this Task Force Report establish the importance of remittances for sustaining local livelihoods as well as rehabilitating institutional infrastructures and improving financial inclusion in post-conflict environments. Highlighting the increasing complexity of global remittance systems, the report examines the growing informality of conflict-induced remittance flows and explores solutions for more efficient linkages between financial institutions of different scales and degrees of formality. It discusses challenges to regulating international remittance transfers in the context of growing concerns about transparency, and documents the increasing role of diaspora networks and migrant associations in post-conflict co-development initiatives. The Task Force Report authors outline the main challenges to leveraging remittances for post-conflict development and make recommendations for further research and policy applications

Perceived value in payment modes: cognitive and affective value among Brazilian consumers

Consumers have been found to hold certain perceptions on Payment Modes (PMs) such as cash, credit or debit card, or digital payments, which will then influence their spending and purchasing behavior (e.g., the type, value and amount of purchased goods). Increasing attention has been devoted to this phenomenon. Despite the extensive body of research on the subjectivity underlying PMs and subsequent impact on consumers’ decision-making process, contradictory findings have been reported. Moreover, a scale to assess consumers held perceptions of PMs is still lacking. This study focuses on the concept of consumer perception of PMs. We draw on the marketing literature on payments and on two well-accepted theoretical frameworks - the Cognitive-Affective Behavioral Paradigm and the Consumption Value Theory - to put forward three specific hypotheses on the cognitive and affective value perceived by consumers. We focus on what has been classified as the ‘most traditional’ and ‘more innovative’ PMs, i.e., cash and digital payments. The aim of this project is twofold: first, to develop a measurement scale for measuring consumers perceived value of PMs, and second, we show how traditional PMs are less valued by consumers than more innovative ones. The suggested scale is an extended and adapted version of PERVAL, a well-established scale for assessing the value of goods and services. The scale was validated with a sample data of 400 Brazilian consumers employing a confirmatory factor analysis. The suggested hypothesis were tested with the same database, using a mean comparison model via multi-linear regression. Results show that consumers perceive cash having the lower cognitive value when compared to other PMs, and digital holding the higher affective value. Also, digital was found having the highest overall perceived value, also leading to the most positive attitude regarding PMs. This study contributes to the literature, first by providing a consumer perceived value measurement scale for PM scale which considers recent PMs and the cognitive and affective dimensions. And second, we show that consumers perceive PM underlying value differently, perceiving digital PM as the one which results in higher value. This is expected to affect their decision-making. The research also provides managers and the payment industry with a clearer understanding of the differences in perceived value between different PMs, reflecting insights on the strategy regarding offered payment experiences for different types of purchases, as well as for the development of new PMs

The Competitiveness of Nations: Economic Growth in the ECE Region

Why do some countries grow much faster, and have much better trade performance, than other countries? What are the crucial factors behind such differences, and what can governments do in order to improve the relative position of their economies? This paper outlines a synthetic framework, based on Schumpeterian logic, for analysing such questions. Four different aspects of competitiveness are identified; technology, costs, capacity and demand. The framework is applied to a sample of 49 countries between 1993 and 2001.

International Mobile Roaming - How smart regulation could achieve sustainable improvements in the competitive climate of the European telecom sector.

International roaming has been a frequently debated subject in the European telecom sector lately. While prices on most other mobile services have been reduced by half during the past few years, roaming charges have remained fairly static since the service was first introduced with the birth of GSM. While generating large profits for Europe’s dominating operators, the situation constitutes a restriction to the freedom of movement concept within the EU Internal Market. In June 2006 the EU Commission proposed a regulation by capping prices for roamed voice traffic on both the wholesale and the retail level. Through studies of literature, articles and statistics, and through interviews with the regulators, operators and other experts it has been my ambition to give answers to the following questions: 1. In what direction is the European mobile telecom sector developing? Who are its dominant players today and tomorrow? 2. What role does international roaming play in this development? 3. What are the purposes of the proposed regulation, and how would it change the conditions for effective competition? 4. Could the regulation’s design be modified to better fulfil its purposes? The study shows that the sector through a massive trend of consolidation is developing towards a pan-European service oligopoly, consisting of Vodafone and two strategic alliances formed by some of Europe’s dominating operators. It further shows that international roaming has played an important role in this development by adding to the industry’s already strong network externalities, thus posing a significant problem for Europe’s few remaining independent operators. Low roaming charges has sailed up as the top priority in the lucrative MNC (Multinational Corporations) market segment, making cost efficient supply of roaming services into a key success factor in industry. By reciprocal discount agreements, oligopoly players have the possibility to margin squeeze independents out of this market. Regulation as proposed by the Commission would, by applying a wholesale price cap, reduce the scope for such margin squeezes significantly and thereby evening out the competitive conditions among operators. However, the study draws me to conclude that the competitive climate has not been a major concern of the Commission’s. The EU is in serious need of public support, and the regulation’s design rather points towards that speed and clarity of results have been the top priorities. Such results are ensured by capping prices even on the retail level. In the meanwhile other issues, such as price caps for roamed data traffic and standardized contract procedures, have more or less been left out of the discussion. The general conclusion is that the Commission, by adding a few modifications to its proposed model, could trade short-term populism to achieve sustainable improvements in the competitive climate of the sector. The study includes three recommendations addressed to the Commission: Ad to the model a uniform wholesale price cap on roamed data traffic Ad to the model a uniform duty to provide roaming contracts to all interested parties Give national regulatory authorities the responsibility to independently handle retail issues The study finally argues that regulation of international roaming, if designed to encourage competition in the network sector, has the potential to achieve positive dynamic effects even in upstream (equipment) and downstream (content) markets

Cross-border Market Co-creation, Dynamic Capabilities and the Entrepreneurial Theory of the Multinational Enterprise

The concepts of asset co-specialization and dynamic capabilities have been instrumental in furthering the organization and strategy scholarship agenda, but have so far had limited impact to the theory of the MNE and FDI. In addition, the role of entrepreneurial management in orchestrating system-wide value creation through market and eco-system creation and co-creation, in order to advance private appropriation, has been all but ignored. We claim that these ideas can help explicate the nature of the MNE in the knowledge-based, semi-globalized economy. The nature of the MNE in its turn should not be seen as separable from either the objectives of the agents (entrepreneurs) who set them up or its essence – the employment of strategy to capture co-created value.Asset Co-specialisation; Dynamic Capabilities; Cross-border Market and Ecosystem Co-creation; Theory of MNE and FDI; Entrepreneurial Theory

Financial innovations and bank performance in Kenya: evidence from branchless banking models

PhD (Finance), School of Economic and Business Sciences, UNIVERSITY OF THE WITWATERSRAND, JOHANNESBURG 8th June, 2016This study examines the relationship between financial innovation and financial performance of commercial banks in Kenya, as well as the drivers of financial innovations at both firm and macro levels. The financial innovations covered are the branchless banking models, which represent a departure from the traditional branch-based banking. More specifically, the financial innovations covered are: Mobile banking, agency banking, internet banking and Automated Teller Machines (ATMs). The study uses 10-year panel (secondary) data for the period spanning year 2004 to 2013. The study conducts an empirical analysis of the four types of financial innovations using three econometric models. The models have been specified using Koyck distributed lag models and estimated using dynamic panel estimation with System Generalised Method of Moments (GMM). The speed of adjustment of bank financial performance to financial innovation as well as the speed of adjustment of financial innovation to the financial innovation drivers has been tested using Koyck mean and median lags. The empirical results provide strong evidence of the link between financial innovations and bank financial performance with respect to Kenyan commercial banks. The study makes a number of other findings. Firstly, financial innovations significantly contribute to firm financial performance and that firm-specific factors are more important to the firm’s current financial performance than industry factors. Secondly, firm-specific variables significantly drive financial innovations at firm level with firm size being the most significant driver of financial innovation at firm level. The firm specific factors include firm size, transaction costs, agency costs, and technological infrastructure at firm level. Thirdly, macro level variables significantly drive financial innovation at firm level with regulation being the most important driver at macro level. The macro level drivers reviewed include: Regulation and taxes, incompleteness in financial markets, technological infrastructure at macro level and globalisation. Lastly, the existence of reverse causation between firm financial performance and firm financial innovation is established. The speed of adjustment of firm financial performance to financial innovation has been determined. The results show that it takes on average 1.179 years for bank financial performance to adjust to the four financial innovations studied. Secondly, it takes less than a year (0.368 years) to accomplish 50% of the total change in firm performance following a unit-sustained change in the financial innovations. Moreover, mobile banking has the shortest mean lag (2.849) while ATMs have the longest mean lag (4.926). Therefore, it takes approximately three years for mobile banking to adjust to financial innovation drivers at firm level and on average five years for ATMs to adjust to the financial innovation drivers. By and large, the speed of adjustment of financial innovations to macro level drivers is higher than the speed of adjustment of financial innovations to firm level drivers. This study has made significant contribution to the body of knowledge in the field of financial innovations. The study has developed an econometric model which captures four financial innovations in a single study and empirically used the model to test their link to firm financial performance. The second and third econometric models have also captured the drivers of financial innovations at firm and macro levels. The reviewed literature observes that previous studies have largely focused on financial products in developed countries at the expense of emerging financial innovations in developing countries. In addition, previous studies have also largely ignored empirical approaches to the study of financial innovations. This study has empirically established the link between financial innovations and firm performance by modelling the four innovations in single model in a developing country (Kenya) context. One of the major contributions of this study is the establishment of the speed of adjustment of firm performance to financial innovations and the speed of adjustment of financial innovations to financial innovation drivers at both firm and macro levels. Lastly, the study has developed an original conceptual financial innovation value model (Fig. 6.1), which will be used in future financial innovation studies. This study has a number of managerial and policy implications which have been reviewed in the study.MT201

Investigating failure to implement contactless payments: a case of Near Field Communication payment systems in South Africa

Near Field Communication (NFC) contactless payment systems are being touted as the future for retail payments and public transport fare-collection systems. Studies have shown that such initiatives require many organisations from different industries to work together for the goal to be realised. The effort and collaboration required to achieve this goal cannot be underestimated. The aim of this research is to explore the failure of NFC contactless payment system implementations. The Actor Network Theory (ANT) has been shown as appropriate for investigating IT implementation failures, and so serves as a study lens for this investigation. A case study research strategy was used in the research to gain an understanding of the as-lived experiences of the actors involved in an NFC payment system implementation. The data was collected using different methods such as interviews and review of project documents. Thematic analysis techniques were used to trace and unpack the interactions occurring around implementation of these NFC payment systems and the challenges encountered. The key factors identified as leading to the NFC payment system implementation failure are external dependencies, lack of required financial investments, interoperability issues due to new and legacy systems, and lack of clear governance structures and bodies. The results of the study suggest that, when there is external dependence, but the tasks, resources required, actors' capabilities, workloads and the duration for completing these tasks are not known, then there will be frequent conflicts, leading to NFC payment system implementation failure. Regulatory bodies and clear leadership structures in collaborative NFC payment system implementation were found to be crucial. The results of the study also propose that when new and legacy systems from multiple actors are to be integrated to develop an NFC payment platform, there is likely going to be system interoperability issues due to the numerous vendors involved, which lead to failure. In addition, unwillingness to commit to the required capital investments by stakeholders was identified as leading to the failure of the NFC payment system implementation. A prescriptive framework is developed based on these lessons that could aid in ensuring better outcomes in future NFC payment systems implementations