Information Policy and Technology Diffusion: Lessons from Bosnia, Croatia, Macedonia, Montenegro, Serbia and Slovenia

Some governments choose telecommunications policies that hinder technology diffusion, while others choose policies that appear to do a good job at encouraging technology diffusion and reaping subsequent economic rewards.  Bosnia, Croatia, Macedonia, Montenegro, Serbia and Slovenia—all former members of the Republic of Yugoslavia—have enacted different kinds of information policy reforms over the last 20 years.  These different policy decisions have led to diverse outcomes. Some of the outcomes present puzzles, while others seem to follow the received wisdom regarding best practices. Bosnia and Serbia, considered by many to be the least open and democratic of these six regimes, have the lowest levels of technology use. Macedonia and Montenegro have achieved similar outcomes in terms of levels of telecommunications technology adoption rates, but have followed different policies to achieve these results. Yet Slovenia, which did none of the commonly touted reforms, has reaped most of the economic benefits of technology diffusion.

• What explains such different causal outcomes?
• Which policy reforms have the best discernible impact on technology diffusion and economic development?
• Which combinations of political, economic and cultural conditions allow governments to make effective telecommunications policy?

We analyze the status and effects of membership application with EU, the degree to which regulatory functions are divorced from ministerial ones, the formation of coherent information and broadband policy, and the degree of monopoly privatization, market liberalization, and mobile competition. Among the countries studied here, there may be two ways to distinguish policy innovation:  a set of telecommunications reforms that involves having the state withdraw from service provision and regulatory oversight; and, a set of changes that involves having the state remain active through a publicly owned telecommunications service provider that aggressively protects its turf and moves into other markets.  From the consumer’s point of view, it is not clear that state withdrawal is the best strategy for improving access to ICTs.  And even though many of the reforms have been enacted by countries eager to join the EU, the primary benefits of these reforms seem to accrue to the publicly owned telecommunications firm from a country that is already in the EU.