Differences in National IT Investment: What Really Matters

This paper looks at factors that influenced national investment in information technology during the tumultuous time period 1993 through 2002. Whereas spending from 1993-1997 was influenced by uncertainty avoidance and individualism, after 1998 these factors no longer influenced IT investment. Similar to studies of IT usage in the previous decade (1985-1995) we find that the structure of the economy, measured by the percentage of national employment in services, continued to drive IT investment (Kraemer et al. 2000),. However, overall country wealth (GDP per capita) was no longer a significant predictor of information technology investment. Interestingly, wealth output per personal computer (PC wealth) explained a portion of the variance in investment among nations. Countries with highest IT spend as a percent of GDP tended to have lower PC wealth. Investment slowed as nations became more productive with their computers, generating greater wealth output per personal computer.