Firms, workers, and consumers in developing countries are increasingly connected to each other and the rest of the world through the internet. Can this connectivity transform poor economies, as techno-optimists hope, or are there more deeply rooted barriers to economic development? Research on the topic is growing rapidly. In this article we provide an overview of existing evidence on the extent to which, and how, internet connectivity affects economic development. Not surprisingly, estimates vary widely with the context, particular outcome, and form of internet studied. Overall the literature points towards sizeable economic impacts in many—though not all—settings.
