The Communications Revolution, Transactions Costs, Culture And Economics Performance

Abstract

In examining the effects of the communications revolution on economic performance, the paper makes a distinction between the exchange and policing aspects of transactions costs and shows how they can be mapped into what are distinguished as the material and cosmological beliefs of different cultures. It argues that whilst the transaction costs associated with 'exchange' will decline (using evidence from 15 developing countries on the costs of doing business), the effects on the 'policing' aspects of transactions costs are more ambiguous and likely to vary across cultures.