Journal
OXFORD BULLETIN OF ECONOMICS AND STATISTICS
Volume 73, Issue 4, Pages 539-555Publisher
WILEY
DOI: 10.1111/j.1468-0084.2010.00622.x
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Funding
- Netherlands Organization for Scientific Research NWO
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The adoption of information and communication technology (ICT) can have far-reaching effects on the nature of production technologies. Because ICT adoption is incomplete, especially in developing countries, different groups of firms will have different production technologies. We estimate a latent class stochastic frontier model, which allows us to test for the existence of multiple production technologies across firms and consider the associated implications for efficiency measures. We use a unique data set of Chilean retailers, which includes detailed information on ICT adoption. We find three distinct production technologies. The probability of membership in a more productive group is positively related to ICT use.
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