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Adoption of digital and ICT technologies and firms’ productivity

Author

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  • Zoran Aralica

    (The Institute of Economics, Zagreb)

  • Bruno Skrinjaric

    (The Institute of Economics, Zagreb)

Abstract

This paper has two main goals. First, it aims to answer the question on how the usage of ICT and digital technologies affects firm productivity. Second, it aims to analyze how change in the share of the manufacturing sector and/or the service sector in a given region direct changes in firm productivity. The analysis was carried out using a financial dataset of Croatian enterprises in the period from 2009 to 2019 and Eurostats’ Digital Economy and Society data, based on “Community survey on ICT usage and ecommerce in enterprises”. The data were analyzed using principal component analysis and panel data methods. The results indicate a positive relationship between adoption of ICT technologies and firm productivity, and a negative correlation between adoption of digital technologies and firm productivity. Furthermore, the results show a high degree of deindustrialization of certain regions and a positive correlation between industry intensity in certain regions and firm productivity. Finally, there seems to be a positive premium on productivity for larger-sized firms, firms participating in international trade, companies situated near to key international markets (i.e., located in counties bordering with the City of Zagreb).

Suggested Citation

  • Zoran Aralica & Bruno Skrinjaric, 2021. "Adoption of digital and ICT technologies and firms’ productivity," Working Papers 2102, The Institute of Economics, Zagreb.
    • Handle: RePEc:iez:wpaper:2102
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    References listed on IDEAS

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    2. Wen, Huwei & Zhong, Qiming & Lee, Chien-Chiang, 2022. "Digitalization, competition strategy and corporate innovation: Evidence from Chinese manufacturing listed companies," International Review of Financial Analysis, Elsevier, vol. 82(C).

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    More about this item

    Keywords

    ICT; digital technologies; economy structure; productivity; Croatia;
    All these keywords.

    JEL classification:

    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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