ICT Usage and Its Impact on Profitability of SMEs in Africa
Just published in Information Technologies and International Development (ITID), this article by Steve Esselaar, Christoph Stork, Ali Ndiwalana, Mariama Deen-Swarray, reports on a Research ICT Africa survey. It argues that the negative return on investment reported in the literature can be attributed to the failure to distinguish between the formal and informal sectors. This article demonstrates that informal SMEs have a higher profitability than formal ones. It further shows that ICTs are productive input factors and that their use increases labor productivity for informal as well as formal SMEs. There is still demand for fixed-line phones among SMEs but, as the authors observe, mobile phones have become the default communications tool because fixed lines are either too expensive or not available. The primary policy recommendation arising out of this is that applications for SMEs need to be developed using mobile phones.
Download the journal article in .pdf from the ITID website.
Download the full study, Towards An African e-Index: SME e-Access and Usage in 14 African Countries, from the RIA! website (.pdf, 2.25 MB).
Steve Esselaar is currently employed as a Researcher at the LINK Centre, University of the Witwatersrand. The LINK Centre conducts research nto the regulatory and policy environment surrounding telecoms and ICT in Africa with a particular focus on the issues of affordability and access.
Christoph Stork is Senior Researcher at the Link Centre at the University of the Witwatersrand in Johannesburg, South Africa. He holds a Ph.D. in Financial Economics from London Guildhall University, UK, a Diplom Kaufmann (MA) from the University of Paderborn, Germany, and a BA in Economics from the University of Nottingham, Trent, UK. His main research interest is in measuring the impact of ICTs on economic growth, employment creation and poverty alleviation.
Mariama Deen-Swarray is a Researcher at the Namibian Economic Policy Research Unit. She holds a BSc (1st Class) in Computer Science and Economics. She is a member of the Research ICT Africa! (RIA!) network where she is involved in ICT research.
Aman Sagar is a Design Researcher at Motorola Research Labs (India), working in the ªeld of Interaction Design for High Growth Markets and Enterprise Mobility. He completed his PG in Information and Digital Design in 2005 from the National Institute of Design (Ahmedabad, India).
![[del.icio.us]](http://images.del.icio.us/static/img/delicious.small.gif){kind=small}
