A Measurement of Information and Communication Technology contribution on Corporate Competitiveness Management and Efficiency between Taiwan and China Finance Industry

This research is to investigate if ICT investment in Taiwan’s and China’s industries has a positive effect on economic growth. In order to achieve this objective, we will first review the literature related to this field. Then, we will modify a (Capital-Labor-Energy-Material-Information, KLEMI) model to conduct the empirical analysis for Taiwan and China for comparative study. In this paper, we calculate the relative efficiency for bank, insurance, and stock sectors based on inputs and outputs of an Input–Output table. Empirical results derived utilizing the KLEMI model reveal that ICT generally has a positive effect on production in Taiwan’s and China‘s industries; however, the financial industry in Taiwan experienced increasing returns to scale (IRS) after investing in ICT. On the other hand, the financial industry in China experienced Constant Returns to Scale CRS after investing in ICT. This study divided ICT investment in the financial industry into ICT hardware and ICT software investments. This is an early attempt in the literature in this field. The analytical results lead to the finding that the contribution of ICT Software investment to Taiwan’s and China’s financial industry is greater than that of ICT hardware.