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ICT and Productivity - relations and dynamics in a spatial context


  • Otto Raspe


  • Frank Van Oort


  • Lambert Van der Laan



The strong emergence of ICT in the past decades was accompanied by much research on the potential productivity boosting qualities of ICT: high productivity growth was expected. However, empirical evidence on the productivity impact of ICT stayed behind: the Solow paradox. Since then analytical steps were made by using alternative indicators for both ICT adoption and productivity and including longer time periods, distinctions in types of economic activities and adding micro level and firm specific characteristics like size, age, and intensity of innovation. Moreover, ICT was linked to network relations including externalities. These adaptations led to outcomes in favour of a positive relation between the use of ICT and productivity. However, most convincing in this debate was the finding that the effects of ICT on economic performance should be analysed from a perspective which, besides ICT, includes changes in knowledge and organisations. Knowledge is defined here broadly and includes both codified and tacit knowledge. In this paper we focus on the trinity ‘ICT, knowledge and organization’ and add the regional dimension to this. Based on economic literature our hypothesis is that regions where firms increasingly use ICT show a stronger growth of added value and productivity. This positive relationship is, however, co-determined by changes in the broadly defined knowledge level. The use of ICT by firms is analysed at different levels of urbanism in the Netherlands. Most central is the distinction between the metropolitan Randstad, the intermediate zone and the national periphery. By this regional distinction the debate on the centrifugal and centripetal effects of ICT (the death of distance) is included. The empirical measurement as such is based on the low spatial scale of 496 municipalities.

Suggested Citation

  • Otto Raspe & Frank Van Oort & Lambert Van der Laan, 2005. "ICT and Productivity - relations and dynamics in a spatial context," ERSA conference papers ersa05p129, European Regional Science Association.
  • Handle: RePEc:wiw:wiwrsa:ersa05p129

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    References listed on IDEAS

    1. H. Hanson, Gordon, 2005. "Market potential, increasing returns and geographic concentration," Journal of International Economics, Elsevier, pages 1-24.
    2. Combes, Pierre-Philippe & Overman, Henry G., 2004. "The spatial distribution of economic activities in the European Union," Handbook of Regional and Urban Economics,in: J. V. Henderson & J. F. Thisse (ed.), Handbook of Regional and Urban Economics, edition 1, volume 4, chapter 64, pages 2845-2909 Elsevier.
    3. Colin C. Williams, 1994. "Rethinking the Role of the Service Sector in Local Economic Revitalisation," Local Economy, London South Bank University, pages 73-82.
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    5. Paul Krugman & Anthony J. Venables, 1995. "Globalization and the Inequality of Nations," The Quarterly Journal of Economics, Oxford University Press, vol. 110(4), pages 857-880.
    6. Mion, Giordano, 2004. "Spatial externalities and empirical analysis: the case of Italy," Journal of Urban Economics, Elsevier, vol. 56(1), pages 97-118, July.
    7. Masahisa Fujita & Paul Krugman & Anthony J. Venables, 2001. "The Spatial Economy: Cities, Regions, and International Trade," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262561476, January.
    8. Krugman, Paul, 1991. "Increasing Returns and Economic Geography," Journal of Political Economy, University of Chicago Press, vol. 99(3), pages 483-499, June.
    9. repec:hhs:iuiwop:430 is not listed on IDEAS
    10. Fujita, Masahisa & Mori, Tomoya & Henderson, J. Vernon & Kanemoto, Yoshitsugu, 2004. "Spatial distribution of economic activities in Japan and China," Handbook of Regional and Urban Economics,in: J. V. Henderson & J. F. Thisse (ed.), Handbook of Regional and Urban Economics, edition 1, volume 4, chapter 65, pages 2911-2977 Elsevier.
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