94 research outputs found
ICT and Productivity Growth in Transition Economies: Two-Phase Convergence and Structural Reforms
No full textThis paper investigates the role of information and communication technology (ICT) as a driver of improved productivity performance of Central and Eastern European (CEE) countries and Russia (CEER) relative to the EU-15 and the U.S. during the 1990s. The paper investigates how, and to what extent, ICT contributed to a narrowing in the productivity gap. Although investment in ICT capital has strongly increased, total factor productivity (TFP) growth has made the largest contribution to convergence during the 1990s. In a few CEER countries, notably the Czech Republic and Hungary, ICT production contributed more to productivity growth than the EU-15 average. Spillovers from a productive use of ICT in both CEER countries and the EU-15 are still considerably lower than in the U.S.. The paper argues that the convergence process between CEER countries and the EU-15 is characterized by two phases. In the first “restructuring” phase, convergence has been driven by enterprise restructuring in manufacturing, which was facilitated by rapid ICT investment in new plants, and by growth in ICT production in particular through FDI. In the second “expansionary” phase the sustained convergence has to rely more on productivity growth in sectors that make intensive use of ICT, in particular the service sector. While the first phase is dependent largely on openness and basic fundamental reforms, the second phase requires deeper structural reforms focused on product and labor market flexibility, business re-organization and investment in human capital and ICT skills.productivity, economic growth, convergence, ICT, Eastern Europe
The Impact of ICT on Growth in Transition Economies
No full textThe paper analyzes the multi-channel contribution of Information and Communication Technologies (ICT) to output and labour productivity growth in eight transition economies of Central and Eastern Europe (CEE), i.e. Bulgaria, Czech Republic, Hungary, Poland, Romania, Russia, Slovakia and Slovenia between 1995-2001. The impact of ICT on growth in the new five EU member countries (Czech Republic, Hungary, Poland, Slovakia and Slovenia) was higher than the average for the former EU-15. Hence, ICT - through both the capital deepening and TFP growth in ICT-producing sector - contributed to convergence of the level of income between those countries and the EU-15. This was however not the case for Bulgaria, Romania, and Russia, where ICT contribution to growth was lower than in the EU- 15. ICT thus led to income deconvergence. Future growth prospects of the CEE countries, including Russia, will largely depend on further ICT investments and an ability to ensure their productive use on a macro, industry and micro level. The paper speculates that ICT capital will have a significant contribution to long-term growth in Poland, taken as a proxy for other CEE countries, on the level of 15% of the projected average annual GDP growth of 4% until 2025. This projection does not however take into account the potential for emergence of new applications of ICT, which could stimulate further increases in aggregate productivity. Neither does it measure the possible contribution from TFP growth in ICT sector and from the spillover effects of ICT production and use. The paper argues that the potential of ICT will not however be realized without changes in business models and an increase in the quality of human capital and ICT skills. On the macrolevel, as indicated by the New Economy Indicator, ICT will not benefit CEE countries without them making consistent progress in economic, institutional and regulatory environment.productivity, ICT, Eastern Europe
The Potential of ICT for the Development and Economic Restructuring of the New EU Member States and Candidate Countries
No full textICT could help the New Member States catch up with EU-15 in economic terms. The report documents the potential of ICT for improved productivity performance in the Central and Eastern Europe countries (CEE) at the macro and industry level, in relation to the EU-15 and the US.productivity, information and communication technologies, convergence, Eastern Europe
Does ICT Investment Matter for Growth and Labor Productivity in Transition Economies?
No full textFollowing up on a previous paper by the same author on the contribution of ICT capital to growth and labor productivity in Poland 1995-2000, this paper extends the study to eight transition economies: Bulgaria, Czech Republic, Hungary, Poland, Russia, Slovakia and Slovenia. The paper shows that the contribution of investment in IT hardware, software and telecommunication equipment to output growth and labor productivity between 1995 and 2000 in most countries featured in the study was much higher than what might be expected on the basis of the level of their GDP per capita. This may suggest that the transition economies – through the use of ICT - are benefiting from the technological leapfrogging to increase the growth rates in output and labor productivity and hence accelerate the process of catching-up. The relatively large contribution of ICT capital to output growth and labor productivity is due to an extraordinary acceleration in real ICT investments, which were growing between 1995 and 2000 at an average rate of more than 20% a year for almost all countries in the study. Large investments in ICT seem to have been induced by (i) falling prices of ICT products and services, which encouraged companies to substitute ICT for non-ICT capital and (ii) an opportunity for higher-than-normal returns on ICT investments due to a large pent-up demand for ICT infrastructure, a legacy of decapitalization and technological gap existing before 1989.economic growth, post-communist countries, information technology, growth accounting
String Inference from Longest-Common-Prefix Array
No full textThe suffix array, perhaps the most important data structure in modern string processing, is often augmented with the longest common prefix (LCP) array which stores the lengths of the LCPs for lexicographically adjacent suffixes of a string. Together the two arrays are roughly equivalent to the suffix tree with the LCP array representing the tree shape.
In order to better understand the combinatorics of LCP arrays, we consider the problem of inferring a string from an LCP array, i.e., determining whether a given array of integers is a valid LCP array, and if it is, reconstructing some string or all strings with that LCP array. There are recent studies of inferring a string from a suffix tree shape but using significantly more information (in the form of suffix links) than is available in the LCP array.
We provide two main results. (1) We describe two algorithms for inferring strings from an LCP array when we allow a generalized form of LCP array defined for a multiset of cyclic strings: a linear time algorithm for binary alphabet and a general algorithm with polynomial time complexity for a constant alphabet size. (2) We prove that determining whether a given integer array is a valid LCP array is NP-complete when we require more restricted forms of LCP array defined for a single cyclic or non-cyclic string or a multiset of non-cyclic strings. The result holds whether or not the alphabet is restricted to be binary. In combination, the two results show that the generalized form of LCP array for a multiset of cyclic strings is fundamentally different from the other more restricted forms
Does ICT investment matter for growth and labor productivity in transition economies?
No full textFollowing up on a previous paper by the same author on the contribution of ICT capital to growth and labor productivity in Poland 1995-2000, this paper extends the study to eight transition economies: Bulgaria, Czech Republic, Hungary, Poland, Russia, Slovakia and Slovenia. The paper shows that the contribution of investment in IT hardware, software and telecommunication equipment to output growth and labor productivity between 1995 and 2000 in most countries featured in the study was much higher than what might be expected on the basis of the level of their GDP per capita. This may suggest that the transition economies - through the use of ICT - are benefiting from the technological leapfrogging to increase the growth rates in output and labor productivity and hence accelerate the process of catching-up. The relatively large contribution of ICT capital to output growth and labor productivity is due to an extraordinary acceleration in real ICT investments, which were growing between 1995 and 2000 at an average rate of more than 20% a year for almost all countries in the study. Large investments in ICT seem to have been induced by (i) falling prices of ICT products and services, which encouraged companies to substitute ICT for non-ICT capital and (ii) an opportunity for higher-than-normal returns on ICT investments due to a large pent-up demand for ICT infrastructure, a legacy of decapitalization and technological gap existing before 1989
The Economic and Institutional Determinants of the 'New Economy' in Transition Economies
No full textThe contribution of the so-called 'New Economy' to economic growth in developing countries has so far been minimal. Nonetheless, in the longer run the 'New Economy' offers great potential for faster economic growth in post-socialist economies. Realising this potential is, however, not automatic. It could be left unharnessed if there is no suitable institutional and economic infrastructure that would allow for adoption, diffusion, and productive use of information and communication technologies (ICT). The paper here will construct a New Economy Indicator (NEI) that measures the levels of preparedness of transition economies for harnessing the potential of ICT to accelerate long-term economic growth and a catching-up with the developed countries. In the NEI ranking Slovenia scored highest; it is followed by the Czech Republic and Hungary. Albania, Bosnia and Herzegovina, and Serbia-Montenegro (former Yugoslavia) occupy the bottom of the table
What Black Death was to Western Europe, Communism was to Central and Eastern Europe
No full textAbstract
I argue in this chapter that despite its ultimate social, economic, and moral bankruptcy, communism imposed on Poland after 1945 sowed the seeds of the country’s economic success after 1989. The old, feudal social structures were bulldozed to snap Poland out of growth-inhibiting extractive society equilibrium, creating a classless society, boosting social mobility, and securing good quality of education for all. Forced industrialization and unprecedented labour movements supported solid GDP growth rates in Poland until the 1960s, but low returns on investment, lack of technological progress, and external shocks caused declining growth rates in the 1970s, and economic stagnation in the 1980s. I conclude that the assumption that if Poland had returned to capitalism after 1945, it would have developed as quickly as the West, is simplistic. I show that a capitalist Poland would have faced significant challenges to growth, and convergence with the West would not have been guaranteed.</jats:p
Drivers of Poland’s Successful Transition
No full textAbstract
In this chapter I explain the proximate drivers of Poland’s economic success since 1989. I divide the transition into the initial period of ‘shock therapy’ during 1989 1991 and then the second period of economic recovery after 1992. I discuss the ongoing debate on the pros and cons of ‘shock therapy’ versus a ‘gradual’ approach to post-communist transition. I use the example of Poland’s ‘shock therapy’ to analyze both approaches. I conclude that that the differences in actual policies were smaller than implied by the rhetoric of both sides of the debate. I then explain why Poland was more successful than other transition economies, and discuss whether Poland could have grown even faster. I argue that on the whole the Polish transition was almost ‘as good as it gets’. I draw the lessons learned and policy insights from Poland’s transition for other countries.</jats:p
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