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52 WORLD DEVELOPMENT REPORT 2016 Figure 1.2 More firms are using broadband internet a. Share of firms using broadband internet, 2006–14 b. Type of internet use, 2010–14 Percent Percent 100 90 80 70 60 50 40 30 20 10 0 Lowincome countries Lowermiddleincome countries Uppermiddleincome countries Highincome non-OECD countries 2006–09 2010–14 Highincome OECD countries 100 90 80 70 60 50 40 30 20 10 0 Lowincome countries Internet deliveries Lowermiddleincome countries Uppermiddleincome countries Internet purchases Highincome non-OECD countries Website Highincome OECD countries e-mail Source: Hussain (2015) based on World Bank Enterprise Surveys, various years. Data at http://bit.do/WDR2016-Fig1_2. Note: The data cover firms with at least five employees. Panel a is based on 10,161 firms in 100 countries (2006–09) and 33,467 firms in 88 countries (2010–14). The survey question is, “Does this establishment have a high-speed, broadband internet connection on its premises?” Panel b is based on 100 countries in 2010–14 with 45,892 firms (e-mail), 45,872 firms (website), 20,480 firms (internet purchases), and 17,099 firms (internet deliveries). OECD = Organisation for Economic Co-operation and Development. of European firms purchase or sell goods or services online and use any cloud computing services. Only 8 percent use cloud computing services to acquire management software and computing power. And only 3 percent use radio frequency identification devices, which are wireless microchips used to connect machines with one another (the “internet of things”). The use of digital technologies is still basic in most developing countries. In Vietnam, only 2.2 percent of all firms sold their goods or services online in 2011 (up from 0.6 percent in 2007). In Turkey, 92 percent of all firms with at least 10 employees had internet access in 2012, but only 71 percent used it for banking; 55 percent had a website; and 10 percent made orders or reservations online. In Mexico, 84 percent of firms with at least 10 employees used the internet in 2012, but only 26 percent of employees had internet access; and only 13 percent of firms used e-commerce for purchases, and 9 percent for sales. In Brazil, 63 percent of all manufacturing firms with at least 10 employees bought or sold products online, but only 28 percent provide an online catalogue or feature online orders on their website; and only 6 percent allow online payments. And less than half the manufacturing firms in Brazil have an information technology (IT) department or use software supporting management, either for resource planning or customer relations. 3 More productive firms are early adopters of the internet More productive firms are more likely to adopt the internet and use it more intensively. The percentage of firms having a website and selling or buying goods or services online tends to increase with firm productivity in all country income groups (figure 1.4). 4 Firms in the most productive quintile are most likely to have a website or use broadband internet. 5 The correlation between firm productivity and e-commerce is stronger in upper-middle-income countries. In lower-middle-income countries, less than 13 percent of the most productive firms sold or bought goods or services online. The results suggest that only the more productive firms in developing countries overcome (unobservable) barriers to using the internet more effectively. African firms using the internet have on average 3.7 times higher labor productivity than nonusers and 35 percent higher total factor productivity (TFP) (figure 1.5). But the most productive firms that do not use the internet have TFPs comparable to highproductivity internet users. The differences are also found to be larger for labor productivity than for TFP, implying that African firms using the internet are not only more productive but also more capital intensive. 6
ACCELERATING GROWTH 53 Map 1.1 Many more firms are using the internet in Vietnam a. Usage in 2007 b. Usage in 2011 Firms using the internet (%) 30–59 60–79 80–100 Source: Nguyen and Schiffbauer 2015. Data at http://bit.do/WDR2016-Map1_1. Note: The census of Vietnamese firms includes more than 300,000 observations each year. IBRD 42011 Figure 1.3 Many advanced digital technologies have not yet diffused across firms in high-income countries, 2014 100 80 Maximum Median 75th percentile % of firms using these technologies 60 40 Mean Minimum 25th percentile 20 0 PC Internet Broadband Website SCM Source: Eurostat, circa 2014 (EC, various years). Data at http://bit.do/WDR2016-Fig1_3. ERP Digital technologies e-purchases Cloud computing Cloud computing ERP Note: For each technology, the chart shows the distribution across 32 high-income countries of the share of firms (with at least 10 employees) that use that technology. Data are for 2014 or the last available year. CRM = customer relationship management software; ERP = economic resource planning software; PC = personal computer; RFID = radio frequency identification technologies; SCM = supply chain management software. CRM e-sales RFID
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A World Bank Group Flagship Report
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Contents xiii xv xix Foreword Ackno
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CONTENTS vii Boxes O.1 5 Frequently
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CONTENTS ix O.24 35 Digital safegua
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CONTENTS xi B3.8.1 178 Autocratic g
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Foreword We find ourselves in the m
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Acknowledgments This Report was pre
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ACKNOWLEDGMENTS xvii Karl Chua, Mas
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xx ABBREVIATIONS GDP GIS GNI GPS GS
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xxii ABBREVIATIONS BFA Burkina Faso
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Inclusion Efficiency Innovation
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CHAPTER 3 Delivering services Have
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e-HEALTH 191 Figure F3.1 Sequencing
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4. Sectoral policies 5. National pr
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SECTORAL POLICIES 201 Box 4.1 Polic
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SECTORAL POLICIES 215 Box 4.6 Guate
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SECTORAL POLICIES 217 Figure 4.1 Pr
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SECTORAL POLICIES 219 Box 4.7 How b
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SECTORAL POLICIES 221 mandating tha
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SECTORAL POLICIES 223 the internet
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SECTORAL POLICIES 225 Protecting pe
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SECTORAL POLICIES 227 grown since t
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SECTORAL POLICIES 229 Box 4.9 Tech
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SECTORAL POLICIES 231 Box 4.10 Isra
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SECTORAL POLICIES 233 US$74 million
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SECTORAL POLICIES 235 has been clas
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SECTORAL POLICIES 237 Kende, Michae
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THE DATA REVOLUTION 245 Figure S5.1
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THE DATA REVOLUTION 247 A journalis
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NATIONAL PRIORITIES 249 • Rising
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NATIONAL PRIORITIES 251 schools, ho
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NATIONAL PRIORITIES 253 Figure 5.3
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NATIONAL PRIORITIES 267 Box 5.8 Bui
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NATIONAL PRIORITIES 269 Box 5.9 Bui
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NATIONAL PRIORITIES 271 • Explore
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NATIONAL PRIORITIES 275 identify gh
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NATIONAL PRIORITIES 279 Box 5.13 Es
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NATIONAL PRIORITIES 281 experiences
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NATIONAL PRIORITIES 283 dence.” N
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NATIONAL PRIORITIES 285 Kremer, Mic
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ENVIRONMENTAL MANAGEMENT 323 Map F6
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