Working Paper
Diffusion of Digital Mobile Telephony

Are Developing Countries Different?

Factors determining the diffusion of digital mobile telephony across 200 developed and developing countries in the 1990s are studied with the aid of a Gompertz model. The market size and network effects are found to play more important roles in the developing countries; there is also more need for complementing innovations in, for example, financial and payment systems. Even though the developing countries have disadvantages, being late entrants in digital mobile telephony is to their advantage and promotes cross-country convergence. Overall digital technologies are best seen as equalizers, and thus the divide is rather socio-economic or analog than digital.