Exploring the relationship between information and communication technology (ICT) and productivity: Evidence from Australian farms

Abstract

The relationship between information and communication technology (ICT) and farm productivity remains unresolved and often debated with limited evidence. While ICT is generally accepted by many to be a positive driver of productivity, others question it. Realistically, truth is likely somewhere in between. Certain ICT investments are likely to facilitate productivity improvement, whereas others may offer some other benefits such as improved safety or reduced emissions. It is also undeniable that some ICT investments may fail or offer little more than a temporary novelty. Using a sample of Australian farm-level data, analysis in this paper finds a positive relationship between ICT investment and productivity. Specifically, the use of precision agriculture and machinery infused with ICT (such as GPS autosteering tractors) is found to be statistically significant. Moreover, digital internet access or access to the National Broadband Network (NBN) is found to be beneficial—and conversely, farms that reported mobile and internet connectivity problems tended to achieve lower productivity.