ICT sector and regional economic development:Evidence from Karnataka State

This paper distinguishes the contribution of information and communication technology (ICT) sector to economic development by manufacturing and service activities in Karnataka State. Using the available data in the national and State income accounts, the contribution of manufacturing ICT industries and ICT services is estimated from 1993-94 to 2001-02. Estimation results show that the (a) ICT services have a dominant share in the ICT sector’s contribution to national and State income, and (b) ICT sector has a positive and higher share in the State income than in India’s national income and in national income of OECD countries. Further, the paper estimates the determinants of demand for ICT use by cross section and panel data models.