A Non-parametric Analysis of Convergence in ICT Industries

The purpose of this article is to explore the relative merits of capital accumulation and efficiency catch-up in the convergence patterns of labor productivity in theICT (Information and Communication Technologies) sector in a set of developed countries. It is the first convergence analysis of ICT carried out from the non-parametric kernel approach and using an intertemporal data envelopment analysis (DEA) to estimate the efficiency of the analyzed countries. Special care has been paid to the dataset construction, using hedonic prices and unit value ratios because of the nature of the industry. The appropriate technology theory extended with non-immediate spillovers is the theoretical framework used to interpret the obtained results. These show thatlabor productivity, technology and efficiency have moved from a unimodal towards a bimodal distribution over time, beginning the 21th century with two convergence clubs of countries. The conclusions obtained from these results show that while capital intensification offer opportunities to benefit from new knowledge developed by the leaders, assimilation of this knowledge is not immediate and its speed depends upon the social and technological capabilities of the followers. Policy decision-makers should be aware that the choice of the technology has to be complemented with the development of other actives to benefit from all its potentialities.