Waiting To Connect

IT use leads to workers being more productive and greater degrees of employment for both skilled and unskilled workers, though the ratio of skilled to unskilled labour increases with IT use. Most importantly, IT using companies pay more to workers and employees for lesser hours of work, i.e., the quality of jobs is bettered with IT use. One important conjecture we could make is that IT could be perceived as a substitute for lack of resources and physical connectivity to markets.

Foreword .................................................................................................. vii
Preface ...................................................................................................... ix
Contents .................................................................................................. xiii
Summary .................................................................................................xvii
List of Figures ........................................................................................... xix
List of Tables ............................................................................................ xxi
CHAPTER 1
IT in India .................................................................................... 1
1.1 Introduction ................................................................................. 1
1.2 IT Production: Software and Hardware ....................................... 3
1.3 Software, Software exports and ITES: Growth
and development ........................................................................ 5
1.4 Moving up the quality ladder ...................................................... 7
1.5 Government support ..................................................................11
1.6 Why is growth in IT use within India slow? ..............................12
CHAPTER 2
IT in the World Economy ............................................................ 15
2.1 Introduction ...............................................................................15
2.2 Growth and development ..........................................................18
2.3 Firm productivity .......................................................................22
CHAPTER 3
IT Use and Manufacturing ........................................................ 27
3.1 Introduction ...............................................................................27
3.2 Data sources ...............................................................................28
3.3 The Indian manufacturing sector ...............................................30
3.4 Impact of IT use .........................................................................35
3.5 IT use over time .........................................................................36
3.6 IT use by region .........................................................................38
CHAPTER 4
IT Use in India – an explanatory model ..................................... 41
4.1 Introduction ...............................................................................41
4.2 Methodology ..............................................................................42
4.2.1 Single equation models ..................................................44
4.2.2 Decision to invest – Heckman procedure .....................45
4.2.3 Simultaneous equation models ......................................46
4.3 Impact on value added, profit and profitability ........................49
4.4 Impact on producers’ demand for IT .........................................49
4.4.1 Investment demand for IT.............................................49
4.4.2 Producers’ decision to invest in IT ................................50
4.5 Impact on workers, employment, wages, and workdays .............51
4.5.1 Employment ..................................................................51
4.5.2 Employment and wages .................................................52
4.5.3 Employment, wages, and person-days ..........................54
4.6 Effects of labour market restrictions ..........................................54
CHAPTER 5
Results of the Survey ................................................................... 59
5.1 Introduction ...............................................................................59
5.2 Why use IT? ...............................................................................61
5.3 How is IT used? .........................................................................63
CHAPTER 6
Findings and Implications ........................................................... 65
6.1 Summary of findings .................................................................65
6.2 Implications ................................................................................67
6.2.1 Government initiatives ...................................................67
6.2.2 IT eco-system .................................................................68
6.2.3 Software ..........................................................................71
6.2.4 Labour Laws ...................................................................74
6.2.5 Relaxing constraints .......................................................75
6.2.6 Deepening IT use ..........................................................76
CHAPTER 7
Conclusions ................................................................................. 79
Tables ....................................................................................................83
Technical Appendix............................................................................ 115
Appendix Tables ................................................................................ 123
Bibliography....................................................................................... 145
Index .................................................................................................. 157