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Direct and Indirect Impact of ICT on EU’s Productivity Growth

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  • Izabela Mlynarzewska- Borowiec

Abstract

Purpose: The aim of the research is to verify the hypothesis of a significant direct and indirect ICT impact on EU’s productivity changes in 1997-2017. Design/Methodology/Approach: A direct ICT contribution to productivity growth was captured at the macro level with the use of the growth accounting approach. A sector level study was conducted to assess the importance of both direct and indirect ICT transmission channels. The research was carried out with the use of the EUKLEMS 2019 database. Findings: The results confirm the hypothesis about the direct and indirect impact of ICT on EU’s productivity, which seems to be much more important for the old EU members. The indirect ICT transmission channel was found to be of key importance for the EU’s productivity growth. Practical Implications: The study identifies the cause of the decline in EU’s productivity and the possibility of accelerating it by increasing the efficiency of the indirect ICT impact channel functioning. Originality/value: The ICT impact analysis covering the old and new EU members in the period before, during and after the crisis shown in the paper has not been widely presented in the literature to date.

Suggested Citation

  • Izabela Mlynarzewska- Borowiec, 2021. "Direct and Indirect Impact of ICT on EU’s Productivity Growth," European Research Studies Journal, European Research Studies Journal, vol. 0(Special 2), pages 278-287.
    • Handle: RePEc:ers:journl:v:xxiv:y:2021:i:special2-part2:p:278-287
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    References listed on IDEAS

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    1. Strauss, Hubert & Samkharadze, Besik, 2011. "ICT capital and productivity growth," EIB Papers 6/2011, European Investment Bank, Economics Department.
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    3. Bart van Ark & Mary O'Mahoney & Marcel P. Timmer, 2008. "The Productivity Gap between Europe and the United States: Trends and Causes," Journal of Economic Perspectives, American Economic Association, vol. 22(1), pages 25-44, Winter.
    4. Vincenzo Spiezia, 2012. "ICT investments and productivity: Measuring the contribution of ICTS to growth," OECD Journal: Economic Studies, OECD Publishing, vol. 2012(1), pages 199-211.
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    More about this item

    Keywords

    ICT; productivity growth; ICT-producing sectors; ICT- using sectors.;
    All these keywords.

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe

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