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What's Spurious, What's Real? Measuring the Productivity Impacts of ICT at the Firm-Level

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  • Hempell, Thomas
Abstract
In order to assess the productivity effects of information and communication technologies (ICT), regressions based on cross?sectional firm?level data may yield unreliable results for the commonly employed production function framework. In this paper, various estimation biases and econometric strategies to overcome their sources are discussed. The effects are illustrated on the basis of a representative set of panel data for German service firms. The application of a suited SYS?GMM estimator yields evidence for significant productivity effects of ICT which are substantially smaller though than those suggested by cross?section or pooled OLS estimates.

Suggested Citation

  • Hempell, Thomas, 2002. "What's Spurious, What's Real? Measuring the Productivity Impacts of ICT at the Firm-Level," ZEW Discussion Papers 02-42, ZEW - Leibniz Centre for European Economic Research.
    • Handle: RePEc:zbw:zewdip:676
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    References listed on IDEAS

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    Cited by:

    1. Kox, Henk L.M. & Rubalcaba, Luis, 2007. "Business services and the changing structure of European economic growth," MPRA Paper 3750, University Library of Munich, Germany.
    2. Zwick, Thomas, 2004. "Employee participation and productivity," Labour Economics, Elsevier, vol. 11(6), pages 715-740, December.
    3. Fox, Stephen, 2013. "The innovation big picture: Including effectiveness dependencies, efficiency dependencies, and potential negative effects within the framing of new technologies," Technology in Society, Elsevier, vol. 35(4), pages 306-314.
    4. Maliranta, Mika & Rouvinen, Petri, 2003. "Productivity Effects of ICT in Finnish Business," Discussion Papers 852, The Research Institute of the Finnish Economy.
    5. Hans-Günther Vieweg & Thomas Fuchs & Reinhard Hild & Andreas Kuhlmann & Stefan Lachenmaier & Michael Reinhard & Uwe Christian Täger & Sebastian de Ramon & Jan-Egbert Sturm, 2005. "Status and outlook of the “New Economy” in selected EU member states from a German Viewpoint," ifo Beiträge zur Wirtschaftsforschung, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, number 19.
    6. Emannuel Dhyne & Joep Konings & Joep Konings & Stijn Vanormelingen,, 2018. "IT and productivity: A firm level analysis," Working Paper Research 346, National Bank of Belgium.
    7. Lach, Saul & Trajtenberg, Manuel & Shiff, Gil, 2008. "Together but Apart: ICT and Productivity Growth in Israel," CEPR Discussion Papers 6732, C.E.P.R. Discussion Papers.
    8. Henry van der Wiel & George van Leeuwen, 2003. "Do ICT spillovers matter; evidence from Dutch firm-level data," CPB Discussion Paper 26, CPB Netherlands Bureau for Economic Policy Analysis.
    9. Konings, Jozef & Dhyne, Emmanuel & Van den bosch, Jeroen & ,, 2018. "The Return on Information Technology: Who Benefits Most?," CEPR Discussion Papers 13246, C.E.P.R. Discussion Papers.
    10. Federico Biagi, 2013. "ICT and Productivity: A Review of the Literature," JRC Working Papers on Digital Economy 2013-09, Joint Research Centre.
    11. Gürtzgen, Nicole, 2005. "Rent-sharing : Does the Bargaining Regime Make a Difference? Theory and Empirical Evidence," ZEW Discussion Papers 05-15, ZEW - Leibniz Centre for European Economic Research.
    12. Fox, Stephen, 2008. "Evaluating potential investments in new technologies: Balancing assessments of potential benefits with assessments of potential disbenefits, reliability and utilization," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 19(8), pages 1197-1218.
    13. Zwick, Thomas, 2003. "Works Councils and the Productivity Impact of Direct Employee Participation," ZEW Discussion Papers 03-47, ZEW - Leibniz Centre for European Economic Research.

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    More about this item

    Keywords

    Productivity; Information and Communication Technologies; Production Function Estimation; Panel Data; Services;
    All these keywords.

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • C81 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Microeconomic Data; Data Access
    • L80 - Industrial Organization - - Industry Studies: Services - - - General

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