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ICT and productivity growth within value chains

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  • Liu, Chuan
  • Saam, Marianne

Abstract

To what extent have economies become better off because of the diffusion of information and communication technologies (ICT)? We analyze this question based on a growth accounting approach at the level of final output. This approach traces productivity improvements not within sectors but within value chains. It allows judging in a better way to what extent more or better products have become available to final users, in particular consumers, as a result of the diffusion of ICT. A main result is that more than half of the productivity gains related to ICT capital deepening for manufactured goods are contributed by upstream industries. The major part of this contribution is domestic rather than foreign. Moreover, the high sectoral growth in total factor productivity (TFP) in the ICT sector contributes only moderately to TFP growth in non-ICT value chains via the use of intermediates.

Suggested Citation

  • Liu, Chuan & Saam, Marianne, 2019. "ICT and productivity growth within value chains," Ruhr Economic Papers 828, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    • Handle: RePEc:zbw:rwirep:828
    DOI: 10.4419/86788961
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    References listed on IDEAS

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    4. Herrendorf, Berthold & Rogerson, Richard & Valentinyi, Ákos, 2014. "Growth and Structural Transformation," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 2, chapter 6, pages 855-941, Elsevier.
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    More about this item

    Keywords

    ICT; economic growth; productivity; value chains; growth accounting;
    All these keywords.

    JEL classification:

    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • F62 - International Economics - - Economic Impacts of Globalization - - - Macroeconomic Impacts
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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