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Broadband adoption and firm productivity: evidence from Irish manufacturing firms


  • Haller, Stefanie A.
  • Lyons, Sean


We estimate the effects of adopting DSL broadband on firm productivity and productivity growth allowing for differing broadband speeds. We use a two-stage least squares estimator with geographical broadband availability as an instrument to address some potential endogeneity problems in a panel of Irish manufacturing firms. While more productive firms are on average more likely to be using DSL broadband, we find no statistically signicant effect of broadband adoption on firms' productivity (growth).

Suggested Citation

  • Haller, Stefanie A. & Lyons, Sean, 2012. "Broadband adoption and firm productivity: evidence from Irish manufacturing firms," MPRA Paper 42626, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:42626

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    References listed on IDEAS

    1. Mirko Draca & Raffaella Sadun & John Van Reenen, 2006. "Productivity and ICT: A Review of the Evidence," CEP Discussion Papers dp0749, Centre for Economic Performance, LSE.
    2. Tobias Kretschmer, 2012. "Information and Communication Technologies and Productivity Growth: A Survey of the Literature," OECD Digital Economy Papers 195, OECD Publishing.
    3. Arthur Grimes & Cleo Ren & Philip Stevens, 2012. "The need for speed: impacts of internet connectivity on firm productivity," Journal of Productivity Analysis, Springer, vol. 37(2), pages 187-201, April.
    4. Rachel Griffith & Stephen Redding & Helen Simpson, 2009. "Technological Catch-Up And Geographic Proximity," Journal of Regional Science, Wiley Blackwell, vol. 49(4), pages 689-720.
    5. Bertschek, Irene & Cerquera, Daniel & Klein, Gordon J., 2011. "More bits - more bucks? Measuring the impact of broadband internet on firm performance," ZEW Discussion Papers 11-032, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    6. Nina Czernich & Oliver Falck & Tobias Kretschmer & Ludger Woessmann, 2011. "Broadband Infrastructure and Economic Growth," Economic Journal, Royal Economic Society, vol. 121(552), pages 505-532, May.
    7. Holt, Lynne & Jamison, Mark, 0. "Broadband and contributions to economic growth: Lessons from the US experience," Telecommunications Policy, Elsevier, vol. 33(10-11), pages 575-581, November.
    8. van Ark, Bart, 1998. "Productivity," Journal of the Japanese and International Economies, Elsevier, vol. 12(2), pages 171-174, June.
    9. Bronwyn HOWELL & Arthur GRIMES, 2010. "Productivity Questions for Public Sector Fast Fibre Network Financiers," Communications & Strategies, IDATE, Com&Strat dept., vol. 1(78), pages 127-146, 2nd quart.
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    Cited by:

    1. Bertschek, Irene & Briglauer, Wolfgang & Hüschelrath, Kai & Kauf, Benedikt & Niebel, Thomas, 2016. "The economic impacts of telecommunications networks and broadband internet: A survey," ZEW Discussion Papers 16-056, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    2. Stockinger, Bastian, 2017. "The effect of broadband internet on establishments' employment growth: evidence from Germany," IAB Discussion Paper 201719, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    3. Giulia Canzian & Samuele Poy & Simone Schüller, 2015. "Broadband Diffusion and Firm Performance in Rural Areas: Quasi-Experimental Evidence," FBK-IRVAPP Working Papers 2015-10, Research Institute for the Evaluation of Public Policies (IRVAPP), Bruno Kessler Foundation.
    4. McCoy, Daire & Lyons, Sean & Morgenroth, Edgar & Palcic, Donal & Allen, Leonie, 2016. "The impact of broadband and other infrastructure on the location of new business establishments," 27th European Regional ITS Conference, Cambridge (UK) 2016 148688, International Telecommunications Society (ITS).
    5. Bertschek, Irene & Niebel, Thomas, 2015. "Mobile and more productive? Firm-level evidence on the productivity effects of mobile internet use," ZEW Discussion Papers 15-090, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    6. Timothy De Stefano & Richard Kneller & Jonathan Timmis, 2014. "The (Fuzzy) Digital Divide: The Effect of Broadband Internet Use on UK Firm Performance," Discussion Papers 14/06, University of Nottingham, School of Economics.
    7. Eva Hagsten & Patricia Kotnik, 2017. "ICT as facilitator of internationalisation in small- and medium-sized firms," Small Business Economics, Springer, vol. 48(2), pages 431-446, February.
    8. Bertschek, Irene & Briglauer, Wolfgang & Hüschelrath, Kai & Krämer, Jan & Frübing, Stefan & Kesler, Reinhold & Saam, Marianne, 2016. "Metastudie zum Fachdialog Ordnungsrahmen für die Digitale Wirtschaft: Im Auftrag des Bundesministeriums für Wirtschaft und Energie (BMWi)," ZEW Expertises, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research, number 147040.
    9. McCoy, Daire & Lyons, Sean & Morgenroth, Edgar & Palcic, Donal & Allen, Leonie, 2016. "The impact of local infrastructure on new business establishments," MPRA Paper 69074, University Library of Munich, Germany.
    10. Richard Fabling & Arthur Grimes, 2016. "Picking up speed: Does ultrafast broadband increase firm productivity?," Working Papers 16_22, Motu Economic and Public Policy Research.
    11. Thor Berger & Carl Benedikt Frey, 2016. "Structural Transformation in the OECD: Digitalisation, Deindustrialisation and the Future of Work," OECD Social, Employment and Migration Working Papers 193, OECD Publishing.
    12. Hasbi, Maude, 2017. "Impact of Very High-Speed Broadband on Local Economic Growth: Empirical Evidence," 14th ITS Asia-Pacific Regional Conference, Kyoto 2017: Mapping ICT into Transformation for the Next Information Society 168484, International Telecommunications Society (ITS).

    More about this item


    broadband adoption; productivity; IV regression; industry;

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software


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