The Influence of New Information and Communication Technologies on Transaction Costs of Micro-, Small- and, Medium-Sized Enterprises

Abstract

This chapter discusses the relationship between the use of information and communication technologies (ICTs) and transaction costs within micro, small and medium-sized enterprises (MSMEs). The fundamental problem in this relationship is the asymmetric distribution of information. This asymmetry leads to problems such as “adverse selection” and “moral hazard”. Thus, the links between ICTs and the improvement of the economic performance can be explained based on the capability of these technologies in reducing information asymmetries and therefore increasing the firms’ competitiveness. In the case of MSMEs, implementing new ICTs help diminish their frequent lack of information. However, the reduction of transaction costs and their better performance depend not only on the use of ICTs but also on the integration of these technologies in the strategies and day-to-day activities of the MSMEs. For this reason, the training of the personnel and the management is crucial when implementing ICTs in these firms.