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Performance of Telecommunications in India: Panel Arellano-Bond GMM Estimation of Teledensity


Affiliations
1 Formerly Professor, Department of Econometrics, University of Madras, Chennai, Tamil Nadu, India
     

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The growth of telecommunications infrastructure and its performance is at the heart of the digital economy, essential for information and citizen-centric services. Though India has made rapid strides in the provision of the telecommunications network, the teledensity is uneven across the states of India. This paper analyses the determinants of teledensity and its distribution dynamics across 18 Indian states over 15 years between 2004 and 2018 using kernel density plots and the dynamic panel fixed effects Arellano-Bond GMM estimation technique. The AB-GMM estimates show the network externality, NSDP per capita, service sector share in NSDP and literacy rate are the important determinants of relative teledensity across the states of India. The kernel density plots indicate a gradual reduction and convergence of teledensity across states over the years. The half-life estimate suggests that the speed of convergence is 1.13 years i.e it takes 1.13 years to converge in teledensity across the states of India.

Keywords

Telecommunications, Teledensity, Convergence, Kernel Plots, Arellano-Bond GMM Estimation
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  • Performance of Telecommunications in India: Panel Arellano-Bond GMM Estimation of Teledensity

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Authors

T Lakshmanasamy
Formerly Professor, Department of Econometrics, University of Madras, Chennai, Tamil Nadu, India

Abstract


The growth of telecommunications infrastructure and its performance is at the heart of the digital economy, essential for information and citizen-centric services. Though India has made rapid strides in the provision of the telecommunications network, the teledensity is uneven across the states of India. This paper analyses the determinants of teledensity and its distribution dynamics across 18 Indian states over 15 years between 2004 and 2018 using kernel density plots and the dynamic panel fixed effects Arellano-Bond GMM estimation technique. The AB-GMM estimates show the network externality, NSDP per capita, service sector share in NSDP and literacy rate are the important determinants of relative teledensity across the states of India. The kernel density plots indicate a gradual reduction and convergence of teledensity across states over the years. The half-life estimate suggests that the speed of convergence is 1.13 years i.e it takes 1.13 years to converge in teledensity across the states of India.

Keywords


Telecommunications, Teledensity, Convergence, Kernel Plots, Arellano-Bond GMM Estimation

References