The Effect of Adjustment Costs and Organizational Change on Productivity in Canada: Evidence from Aggregate Data
AbstractDanny Leung of the Bank of Canada provides support for the hypothesis that organizational change is a necessary condition for the full realization of the productivity gains associated with ICT. Using aggegate data, the author finds econometric evidence that the impact of computer investment is not fully realized until three years after the initial investment. Firms appear to need a learning period during which they make the necessary adjustments to their organizational structures in order to benefit from the productivity-augmenting potential of ICT. One implication of this analysis is that despite the current lull in investment, productivity growth in Canada should continue to remain fairly robust as firms continue to integrate new technologies into their production processes.
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Bibliographic InfoArticle provided by Centre for the Study of Living Standards in its journal International Productivity Monitor.
Volume (Year): 9 (2004)
Issue (Month): (Fall)
Other versions of this item:
- Danny Leung, 2004. "The Effect of Adjustment Costs and Organizational Change on Productivity in Canada: Evidence from Aggregate Data," Working Papers 04-1, Bank of Canada.
- O51 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - U.S.; Canada
- O47 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Measurement of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
- D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
- O32 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Management of Technological Innovation and R&D
- M11 - Business Administration and Business Economics; Marketing; Accounting - - Business Administration - - - Production Management
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