Effect of Government Incentives on Computerization in Small Business

This study examines the impact of a government incentive programme on computerisation in small businesses in Singapore. It compares the computerisation experience of 40 small businesses which have participated in the programme with that of 40 small businesses which have computerised without government assistance. The main finding is that participation in a government computerisation programme does not result in more effective information systems. However, there is evidence to show that government incentives, in the form of subsidies, low-interest loans, seminars and technical expertise, lower the barriers to computerisation and make it more attractive to small businesses that would otherwise lack the financial resources and technical expertise to computerise. Some possible explanations of the findings are provided.