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ICT and Productivity Growth in the 1990's: Panel Data Evidence on Europe

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  • Christian M. Dahl

    (University of Southern Denmark, CEBR and CREATES)

  • Hans Christian Kongsted

    (University of Copenhagen, CAM and CEBR)

  • Anders Sørensen

    (Copenhagen Business School and CEBR)

Abstract

What has been the quantitative effect on productivity growth of information and communication technology (ICT) in Europe after 1995? Based on a multi-country sectoral panel data set, we provide econometric evidence of positive and signi?cant productivity effects of ICT in Europe, mainly due to advances in total factor productivity. The impact of ICT in Europe has happened against a negative macro economic shock not related to ICT. This is in contrast to the established evidence for the US. Our main results challenge the consensus in the growth-accounting literature that there has been no acceleration of productivity growth in Europe, mainly due to a dismal performance of ICT-using sectors.

Suggested Citation

  • Christian M. Dahl & Hans Christian Kongsted & Anders Sørensen, 2010. "ICT and Productivity Growth in the 1990's: Panel Data Evidence on Europe," CREATES Research Papers 2010-47, Department of Economics and Business Economics, Aarhus University.
    • Handle: RePEc:aah:create:2010-47
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    Cited by:

    1. Andrea Caragliu & Camilla Lenzi & Andrea Caragliu, 2013. "Dynamics of knowledge diffusion: the ICT sector in Lombardy," Regional Science Policy & Practice, Wiley Blackwell, vol. 5(4), pages 453-473, November.
    2. Zheng, Jiajia & Wang, Xingwu, 2022. "Impacts on human development index due to combinations of renewables and ICTs --new evidence from 26 countries," Renewable Energy, Elsevier, vol. 191(C), pages 330-344.
    3. Chang-Gyu Yang & Silvana Trimi & Sang-Gun Lee & Joon-Sun Yang, 2017. "A Survival Analysis of Business Insolvency in ICT and Automobile Industries," International Journal of Information Technology & Decision Making (IJITDM), World Scientific Publishing Co. Pte. Ltd., vol. 16(06), pages 1523-1548, November.
    4. Munshi Naser Ibne Afzal & Munshi Naser Ibne Afzal & Jeff Gow & Jeff Gow, 2016. "Electricity Consumption and Information and Communication Technology in the Next Eleven Emerging Economies," International Journal of Energy Economics and Policy, Econjournals, vol. 6(3), pages 381-388.
    5. Roberto Camagni & Roberta Capello & Giovanni Perucca, 2022. "Beyond productivity slowdown: Quality, pricing and resource reallocation in regional competitiveness," Papers in Regional Science, Wiley Blackwell, vol. 101(6), pages 1307-1330, December.
    6. Vincenzo Atella & Lorenzo Carbonari, 2017. "Is Gerontocracy Harmful for Growth? a Comparative Study of Seven European Countries," Journal of Applied Economics, Taylor & Francis Journals, vol. 20(1), pages 141-168, May.
    7. Hope, David & Martelli, Angelo, 2019. "The transition to the knowledge economy, labor market institutions, and income inequality in advanced democracies," LSE Research Online Documents on Economics 100382, London School of Economics and Political Science, LSE Library.
    8. Edquist, Harald & Henrekson, Magnus, 2017. "Swedish lessons: How important are ICT and R&D to economic growth?," Structural Change and Economic Dynamics, Elsevier, vol. 42(C), pages 1-12.
    9. Raquel Ortega-Argilés, 2012. "The Transatlantic Productivity Gap: A Survey Of The Main Causes," Journal of Economic Surveys, Wiley Blackwell, vol. 26(3), pages 395-419, July.
    10. Niebel, Thomas, 2018. "ICT and economic growth – Comparing developing, emerging and developed countries," World Development, Elsevier, vol. 104(C), pages 197-211.
    11. Rehman, Naqeeb Ur & Nunziante, Giulia, 2023. "The effect of the digital economy on total factor productivity in European regions," Telecommunications Policy, Elsevier, vol. 47(10).
    12. Fernández de Guevara, Juan & Hofman, André A. & Aravena, Claudio & Mas, Matilde, 2014. "Evaluating policies to improve total factor productivity in four large Latin American countries," Macroeconomía del Desarrollo 36839, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    13. Falk, Martin & Hagsten, Eva, 2015. "E-commerce trends and impacts across Europe," International Journal of Production Economics, Elsevier, vol. 170(PA), pages 357-369.
    14. Anupam Das & Murshed Chowdhury & Sariah Seaborn, 2018. "ICT Diffusion, Financial Development and Economic Growth: New Evidence from Low and Lower Middle-Income Countries," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 9(3), pages 928-947, September.
    15. Maté Fodor, 2016. "Essays on Education, Wages and Technology," ULB Institutional Repository 2013/239691, ULB -- Universite Libre de Bruxelles.
    16. Gasanov, Oscar, 2022. "Влияние Цифровизации На Экономику России [The impact of digitalization on the Russian economy]," MPRA Paper 119772, University Library of Munich, Germany, revised 30 Jun 2022.
    17. Capello, Roberta & Lenzi, Camilla & Perucca, Giovanni, 2022. "The modern Solow paradox. In search for explanations," Structural Change and Economic Dynamics, Elsevier, vol. 63(C), pages 166-180.
    18. Chung, Hyuk, 2018. "ICT investment-specific technological change and productivity growth in Korea: Comparison of 1996–2005 and 2006–2015," Telecommunications Policy, Elsevier, vol. 42(1), pages 78-90.

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    More about this item

    Keywords

    Labor productivity; total factor productivity; information and communications technology; panel data methods.;
    All these keywords.

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • 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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