Convergence in telecommunications infrastructure development in OECD countries

Abstract

We use a database of 22 member countries of OECD for the years 1980 to 1995 to explore the issue of convergence in the pattern of efficiency with which the telecommunications sector have been developed among OECD countries. Our approach uses data envelopment analysis (DEA) to explore the order of magnitude of performance differences between countries. We then test for σ-convergence using Friedman’s (1992) [Friedman, M., 1992. Do old fallacies ever die? Journal of Economic Literature 30, 2129–2132] suggestion that the coefficient of variance is a useful measure for this task. Thereafter, we use two rank tests – the Wilcoxon Matched-Pairs Signed Rank Test and Kendall’s Coefficient of Concordance – to evaluate the presence of β-convergence or intra-distributional mobility. Our empirical investigation suggests that OECD countries have σ-converged and also, to some extent, β-converged in their development of telecommunication infrastructures. Our empirical exploration further indicates that OECD countries have distinctly σ-converged in efficiency with which they have provided the fixed and cellular telecommunications infrastructure. Our data do not support the presence of β-convergence, or leapfrogging, in the efficiency of telecommunications infrastructure provision among OECD countries.