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Bridging the Digital Divide in Microeconomies: US Virigin Islands New Research Agenda. William DeLone IT Research Seminar September 17, 2003. DeLone Success Research. DeLone & McLean Success Model Impacts/Net Benefits Individual level Firm level Market level Country Level **.

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Bridging the digital divide in microeconomies us virigin islands new research agenda

Bridging the Digital Divide in Microeconomies: US Virigin IslandsNew Research Agenda

William DeLone

IT Research Seminar

September 17, 2003

DeLone: E-Development

Delone success research
DeLone Success Research Islands

  • DeLone & McLean Success Model

  • Impacts/Net Benefits

    • Individual level

    • Firm level

    • Market level

    • Country Level **

DeLone: E-Development

Brief history of is
Brief History of IS Islands

  • Back office automation

  • Decision Support

  • Competitive Advantage – AA, Walmart,

  • Productivity Paradox

  • Information economy

    • “wealth is information applied to work to create value.” (Wriston)

DeLone: E-Development

It gnp dedrick gurbaxani kraemer 2003
IT & GNP Islands (Dedrick,Gurbaxani & Kraemer, 2003)

DeLone: E-Development

It has hit the big time
IT Has Hit the Big Time Islands

Research Challenge: Expand our horizons as IT researchers to high impact research such as industry, market and country level research

DeLone: E-Development

It research social responsibility
IT Research & Social Responsibility Islands

  • The potential of the Global Digital Divide

  • What about the Small Fries (Small country economies/micro-economies)? Dewan & Kraemer 1998, 2000 => Bad News

  • DeLone 1982 Small business computer use

  • DeLone 2002 Small country IT use

DeLone: E-Development

Digital divide

Digital IslandsDivide

Katharine Fierro (Peru)

Victor Orantes (Guatemala)


DeLone: E-Development

Fighting the digital divide
Fighting the Digital Divide Islands

  • “Everyone, everywhere, should be enabled to participate in, and no one should be excluded from, the benefits of the global information society” IT charter of G-8 summit

DeLone: E-Development

Four main challenges
Four Main Challenges Islands

  • Reduce the poverty levels

  • Stop the brain drain

  • Lack of educational opportunities

  • Lack of political will

DeLone: E-Development

How can we address those issues
How can we address those issues? Islands

  • Competition

    • Friendly regulatory environment

    • Liberalization of trade in every aspect in order to promote economic growth

    • Government participation in playing a subsidiary role in providing in infrastructure and education for the poorest

DeLone: E-Development

Anticipated outcomes
Anticipated Outcomes Islands

  • Direct foreign investment will come to the area

  • Income levels will raise

  • It will lessen the brain drain

  • Finally it will help to bridge the gap between developed and developing countries

DeLone: E-Development

Implications for caribbean economies
Implications for Caribbean Economies? Islands

DeLone: E-Development

New paradigms
New Paradigms Islands

  • Wealth created via intellectual assets

  • Geographical constraints removed

  • Natural resources not required

  • Knowledge workers in demand

DeLone: E-Development

Digital divide microeconomies
Digital Divide & Microeconomies Islands

  • Poor Economies of Scale

  • Lack of Economic Resources

  • Poor telecommunications Infrastructure

  • Limited Educational Opportunities

  • Limited Intellectual Capital

DeLone: E-Development

E development

E-Development Islands

Economic growth via the information-based businesses or e-businesses

DeLone: E-Development

E development competitive factors
E-Development IslandsCompetitive Factors

  • Telecommunications Infrastructure

  • Trained Workforce

  • Business Incentives

  • Business Climate (Time is money)

  • Business Infrastructure

  • Political Stability

  • Government, Industry, Labor, Education

DeLone: E-Development

E development obstacles
E-Development Obstacles Islands

  • Organizational legacy

  • Administrative heritage

  • Political will

DeLone: E-Development

Crossing the digital divide

Crossing the Digital Divide Islands

The Role of Leadership

DeLone: E-Development

It productivity mediating variables
IT, Productivity & Mediating Variables Islands

  • IT + Organizational Capital => Firm Productivity (Brynjolfsson & Hitt, 2000; Bresnahan et al. 2002)

DeLone: E-Development

It productivity mediating variables1
IT, Productivity & Mediating Variables Islands

  • IT + Institutional Capital => Economic Productivity ??

DeLone: E-Development

The virgin islands case

The Virgin Islands Case Islands


Technology Park

SWOT Analysis

DeLone: E-Development

Virgin islands strengths
Virgin Islands - Strengths Islands

  • United States legal jurisdiction

  • Tax benefits

  • Access to high bandwidth

  • Business friendly University = decision-making speed

  • Near shore location

DeLone: E-Development

Virgin islands weaknesses
Virgin Islands - Weaknesses Islands

  • Lack of IT support infrastructure

  • Lack of IT-skilled workforce

  • High cost of living

  • Lack of private-public sector partnership

DeLone: E-Development

Uvi technology park mission
UVI Technology Park IslandsMission

  • To create a technology sector in the Virgin Islands by attracting and developing new knowledge-based businesses that will spur economic development, create jobs for local residents and generate revenues for the financial support for the University.

DeLone: E-Development

Goals and objectives
Goals and Objectives Islands

  • Promote technology-based economic development

  • Broaden research and teaching capabilities

  • Collaborate with corporate partners in the creation and commercialization of new technologies and applications

  • Provide an integrated response to job creation and job training.

DeLone: E-Development

Examples of park tenants
Examples of Park Tenants Islands

  • Web hosting companies

  • E-commerce companies

  • Telecommunications companies

  • Software Application Companies

  • Data Centers/Call Centers

  • E-customer service operations

  • Knowledge-based companies

  • High Tech research and development

DeLone: E-Development

Key benefits
Key Benefits Islands

  • Business Investment/New business creation

  • Increased employment/High Paying Jobs

  • Revenues for Government and UVI

  • Diversified economy/Boost to Tourism

  • “Brain Gain”

  • Adjunct faculty/Learning laboratories

  • Environmentally Friendly development

DeLone: E-Development

Where are we today
Where are We Today Islands

  • Board of Trustees approval secured

  • Legislation (Act 6502) signed into law

  • Kogod Field Study

  • Development site identified on St. Croix

  • Park Corporation Board Appointed

  • Strategic partner for world-class e-commerce hosting

  • Local & Federal Financial Support

DeLone: E-Development

Key actions going forward
Key Actions Going Forward Islands

  • Telecommunications connectivity

  • Procure development funding

  • Site development

  • Create Park Corporation organization

  • Alliances with more strategic partners

  • Create VI Technology Education Center (VITec)

DeLone: E-Development

Park success factors
Park Success Factors Islands

  • Educational Leadership

  • Single source of tenant services => UVI & Government collaboration

  • Tax incentives for high-tech tenants in the Park.

  • Professional Management of Park as a profit-making enterprise.

  • Reliable cost-effective broadband connectivity and power.

DeLone: E-Development

Park success factors cont d
Park Success Factors (cont’d) Islands

  • An integration strategy that links training and workforce development with job creation.

DeLone: E-Development

Research question
Research Question Islands

Can investments in Information Technology aided by complimentary institutional capital investments improve the economic performance of Micro-economies?

DeLone: E-Development

Bridging the digital divide in microeconomies us virigin islands new research agenda
Help! Islands

  • Citations

  • Models

  • Methods – Case studies, econometrics,

  • Measures

DeLone: E-Development

Barbados 2000 strengths
Barbados 2000 - Strengths Islands

  • Unifying culture, nationalism

  • Social partnership for economic reform

  • Government stability

  • International Business Companies Act granting favorable corporate tax (1 to 2.5%)

  • Double taxation agreement with Canada

  • Barbados Investment & Development Corporation (BIDC) –

DeLone: E-Development

Barbados 2000 strengths1
Barbados 2000 - Strengths Islands

  • Welcoming business climate

  • Business infrastructure – quality office space, reliable telecommunications and power.

  • Highly literate population; easily trainable workforce

  • Relatively cheap high tech workforce

  • Workforce availability

  • Near shore operation (travel access, time zone advantage)

DeLone: E-Development

Barbados 2000 weaknesses
Barbados 2000 - Weaknesses Islands

  • Cost of telecommunications

  • Lack of workforce trained in IT skills

  • Local business environment/services

  • Slow processing of business transactions by government

  • Non proactive private sector

  • Lack of local entrepreneurship

  • Lack of economic statistics

DeLone: E-Development

Barbados 2000 opportunities
Barbados 2000 - Opportunities Islands

  • Software Development

  • Business Information Services

DeLone: E-Development

Barbados 2000 threats
Barbados 2000 - Threats Islands

  • Competing countries

    • Bermuda

    • Dominican Republic

  • Government inability to act quickly

DeLone: E-Development