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Does Experience Matter? Innovations and the Productivity of ICT in German Services

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  • Hempell, Thomas

Abstract

In this paper, it is argued that ICT investment is closely linked with complementary innovations and most productive in firms with innovative experience. In an analysis based on firm?level panel data covering the period 1994?99, system GMM estimates for an extended production function framework reveal significant productivity effects of ICT in the German service sector. Moreover, there is strong support for the hypothesis that the experience gained from past process innovations is a specific feature that makes ICT investment more productive. The results suggest that ICT may have been contributing to productivity differentials between firms.

Suggested Citation

  • Hempell, Thomas, 2002. "Does Experience Matter? Innovations and the Productivity of ICT in German Services," ZEW Discussion Papers 02-43, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  • Handle: RePEc:zbw:zewdip:675
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    File URL: https://www.econstor.eu/bitstream/10419/24642/1/dp0243.pdf
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    References listed on IDEAS

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    1. Richard R. Nelson, 1982. "The Role of Knowledge in R&D Efficiency," The Quarterly Journal of Economics, Oxford University Press, vol. 97(3), pages 453-470.
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    More about this item

    Keywords

    Productivity; Information and Communication Technologies; Innovation; Services; Panel Data;

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • L80 - Industrial Organization - - Industry Studies: Services - - - General
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D

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