Investments in ICT-capital and economic performance of small and medium scale enterprises in East Africa

Abstract

In this paper, we focused on whether investments in ICTs could cause any increases in a firm's performance. We constructed a data set for two East African countries - Kenya and Tanzania for small and medium scale enterprises and focused on three performance indicators - internal rate of return, labour productivity and domestic and export market expansion. Findings of this paper suggested that investments in ICT have a positive impact on general market expansion. However, it has a negative impact on labour productivity, and such investment does not have any significant impact on the firm's return nor does it determine the firm's exporter (non-exporter) status. Show more