[‘The role of Nokia in the Finnish economy’]"> [‘The role of Nokia in the Finnish economy’]"> [‘Th">
Nothing Special   »   [go: up one dir, main page]
IDEAS home Printed from https://ideas.repec.org/a/oup/ecpoli/v19y2004i38p118-163..html
   My bibliography  Save this article

Not only Nokia: what Finland tells us about new economy growth
[‘The role of Nokia in the Finnish economy’]

Author

Listed:
  • Francesco Daveri
  • Olmo Silva
Abstract
New economy growthIs there a relation between information technologies and the growth rate of productivity? Is this relation mainly due to the efficiency-enhancing effects of few leading industries or rather to the pervasive spreading of IT throughout the economy? Our country study on Finland in the 1990s is a contribution to shed light on these issues. We find that Nokia, the world leader in cellular phone production, directly and substantially contributed to enhance productivity growth in Finland. Productivity growth gains outside Nokia and few other IT-related service industries have been small, temporary, or non-existent at all, though. We also provide two pieces of evidence against the existence of technological spillovers between Nokia and the other fast-growing industries in the Finnish economy. As shown by the Finnish input-output table, the thinness of the inter-industry linkages between the Nokia industry and the rest of the economy indicates that productivity gains of the size recorded in the few other fast-growing service industries can be associated to Nokia's productivity boom only to a very small extent. Parallel statistical analysis also shows a striking association between the timing and the industry distribution of productivity gains and the declining pace of the price of machinery and equipment investment goods in those industries. This is evidence that TFP growth increases in those industries should be mostly attributed to the decline in the world price of computing power. Altogether, we interpret our findings as showing that, even in a country endowed with a world-class national champion and a policy environment commonly thought of as conducive to growth, a ‘new economy’ takes a long time to show up. Unlike commonly held tenets, IT diffusion has shown a limited potential in speeding up this process in Finland.— Francesco Daveri and Olmo Silva

Suggested Citation

  • Francesco Daveri & Olmo Silva, 2004. "Not only Nokia: what Finland tells us about new economy growth [‘The role of Nokia in the Finnish economy’]," Economic Policy, CEPR, CESifo, Sciences Po;CES;MSH, vol. 19(38), pages 118-163.
    • Handle: RePEc:oup:ecpoli:v:19:y:2004:i:38:p:118-163.
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1111/j.1468-0327.2004.00120.x
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:oup:ecpoli:v:19:y:2004:i:38:p:118-163.. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Oxford University Press (email available below). General contact details of provider: https://edirc.repec.org/data/cebruuk.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.