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ICT productivity and firm propensity to innovative investment: learning effect evidence from italina micro data

Author

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  • Gianfranco Enrico Atzeni

    (University of Sassari & CRENoS)

  • Oliviero Antonio Carboni

    (University of Sassari & CRENoS)

Abstract

This work attempts to shed light on the “information technology productivity paradox”. Employing a large data set of Italian manufacturing firms we compute ICT marginal productivity across different cluster of firms and the impact of information and communication technology (ICT) on output growth. Following Yorukoglu’s (1998) vintage capital idea, in which ICT is associated with consistent learning-by-doing effect, we explore whether firm capital replacement/introduction behaviour and firm’s technological investment aptitude have any role in explaining ICT productivity. We find that low capital replacement (high capital introduction) yields to sensibly greater ICT marginal revenues compared to high replacement (low capital introduction). However, what really matters in explaining ICT productivity is the level of innovation the new capital embodies. In fact, for non-innovative firms the ICT paradox is far less consistent. This strongly suggests the existence of learning by doing effects. In terms of growth contribution we find that ICT have an impact disproportionately wide compared to the share in total investment they represent

Suggested Citation

  • Gianfranco Enrico Atzeni & Oliviero Antonio Carboni, 2005. "ICT productivity and firm propensity to innovative investment: learning effect evidence from italina micro data," Industrial Organization 0503012, University Library of Munich, Germany.
  • Handle: RePEc:wpa:wuwpio:0503012
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    References listed on IDEAS

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    2. Boucekkine, Raouf & Germain, Marc & Licandro, Omar, 1997. "Replacement Echoes in the Vintage Capital Growth Model," Journal of Economic Theory, Elsevier, vol. 74(2), pages 333-348, June.
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    Cited by:

    1. Paolo Seri & Tommaso Ciarli, 2014. "Regional structural change and small firms’ adaptabilities: Evidence from Italian firm-level data," Working Papers 1403, University of Urbino Carlo Bo, Department of Economics, Society & Politics - Scientific Committee - L. Stefanini & G. Travaglini, revised 2014.

    More about this item

    Keywords

    Growth; investment behaviour; information and communication technologies; productivity; replacement;

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights

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