Thursday, October 25, 2007

Thesis Update

Have finished the write up of the thesis based on the latest results which were discussed with Dr Poon, which were obtained for two cycles which were based on a structural breakpoint test.

The results indicate that IT has had an effect upon the shift in industry, as can be seen from the regression results obtained for the regression with dummy variables. The regression results indicate that of the IT aspects (Hardware and Software), industry has been increasingly dependent upon Software, and this has had the most effect upon Value added. Comparing this with the clustering results also indicates that Software has had the most impact, since there is coaelscence across the cycles.

One should note that the effects of IT, as discussed by David (1990), and various papers by Brynjolfsson, were able to be illustrated by the results obtained, as the time-lag effect was clearly shown, and disproves the productivity paradox.



Reference:

David, P, 1990, "The Dynamo and The Computer: An historical perspective on the modern productivity paradox", The American Economic Review, Vol. 80, No. 2, Papers and Proceedings of the Hundred and Second Annual Meeting of the American Economic Association. (May, 1990), pp. 355-361.

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