The contribution of ICT to economic activity: a growth accounting exercise with Spanish firm-level data
This paper uses a well-established growth accounting framework to measure the contribution of ICT goods (considered as capital inputs) to output and labour productivity growth in the Spanish economy. We apply this framework to a sample of around 1300 Spanish firms per year over the period 1991-2000. The use of micro-level data is especially useful for the purpose in hand. Firstly, our database provides detailed breakdowns of capital. This helps mitigate the usual mismeasurement problems in obtaining capital stocks. Secondly, by avoiding the usual availability lags associated with the use of aggregate data, we can focus on a more recent period. The main findings may be summarised as follows. 1) The use of ICT as a capital input has made a positive and, relative to its cost share, significant contribution to output and productivity growth. 2) This contribution was higher in the second half of the 1990s. For this period, we estimate that the use of ICT inputs accounted for nearly one-fourth of labour productivity growth. 3) At a sectoral level, we find that there is a general rise in the share of ICT in total capital and a general reduction in ICT cost shares, driven by the sharp downward trend in the prices of ICT products. However, the contribution of ICT inputs displays a degree of heterogeneity across sectors, owing to the disparity of sectoral accumulation rates of ICT inputs. Finally, results at the firm level exhibit a notable heterogeneity, although a majority of firms have experienced an increase in the ICT capital growth rates and in the ICT contribution to growth.
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