2.6 percentage points for moderate poverty after one year of gaining mobile broadband coverage. Households in areas covered by mobile broadband internet witnessed an increase in labor force participation and wage employment of about 3.3 and 1.4 percentage points, respectively, with these effects materializing more slowly after three or more years of coverage.

Turning to Latin America, Iacovone and Pereira – Lopez (2018) study the effects of ICT adoption on Mexican firms’ labor structure and wages between 2008 and 2013 by using an Instrumental Variable technique (based on the interaction between the ICT-intensity classification of sectors, the average elevation of the municipality, and the coefficient of variation of locality elevations). ICT adoption increased labor demand for white-collar workers in the manufacturing sector, such that a 10-percentage point increase in ICT use is associated with a 12 percent increase in the number of white-collar workers. At the same time, no resulting differences were observed in the wage gap between white-collar and blue-collar workers, whether in the manufacturing or services sectors. However, a change of 10 percentage points in the share of labor that uses computers is associated with a change of 0.024 in the ratio of white-collar to blue-collar workers (which is about 10 percent of the mean value for this ratio). The authors explain the results in the manufacturing sector in terms of the increasing sophistication of blue-collar workers, as a direct result of the adoption of digital technologies, due to greater availability of information and improved training opportunities. Thus, Iacovone and Pereira – Lopez (2018) find that promotion of ICT use can be an effective tool, not only to enhance a firm’s productivity, but also to reduce wage inequality between workers.

**Table 3: Survey of selected papers on the development impact of internet coverage**

|**Author**|**Level of**<br>**Analysis**|**Country/**<br>**Region**|**Development**<br>**Indicators**|**Main Finding(s)**|
|---|---|---|---|---|
|Hjort and Poulsen<br>(2019)*|Households|Africa|Jobs|The probability of employment increases by 3 to 13 percentage points<br>with access to fast internet, with a shift towards higher skilled<br>occupations.|
|Masaki et al<br>(2020)+|Households|Senegal|Consumption,<br>Poverty|3G coverage is associated with a 14% rise in household consumption, a<br>10% decline in extreme poverty, and more salaried employment.|
|Bahia et al (2020)+|Household|Nigeria|Consumption,<br>Poverty, Jobs|3G coverage is associated with a 6% rise in household consumption, a<br>4% decline in extreme poverty, and higher better-paid employment.|
|Abreha et al.<br>(2021)|Firms|Ethiopia|Jobs,<br>Production|Firms with enhanced internet access tend to hire 23-26% more workers<br>compared to firms in areas without 3G. This translates into more formal<br>employment and wages. Similarly, firms in areas with 3G experience a<br>17-18% increase in total factor productivity.|
|Iacovone & Pereira<br>-López (2018)*+|Firms|Mexico|Jobs, Wages|A 10-percentage point increase in ICT use is associated with a 12<br>percent increase in the number of white-collar workers.|

Source: Compiled by the authors. Note: Findings column is based on the main finding of the paper. Asterisk identifies papers published in peer-reviewed journals. Plus identifies papers following the instrumental variable approach.

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