IDEAS home Printed from https://ideas.repec.org/p/ssa/lemwps/2024-25.html
   My bibliography  Save this paper

Cloud technologies, firm growth and industry concentration: Evidence from France

Author

Listed:
  • Bernardo Caldarola
  • Luca Fontanelli

Abstract

Recent empirical evidence finds positive associations between digitalisation and industry concentration. However, ICT may not be all alike. We investigate the effect of the purchase of cloud services on the long run size growth rate of French firms. Our findings suggest that cloud services positively impact firm growth rates, with smaller firms experiencing more significant benefits compared to larger firms. This evidence suggests that the diffusion of cloud technologies may help mitigate concentration in the era of the digital transition by favouring the digitalisation and growth of smaller firms, especially when the cloud services provided are more advanced.

Suggested Citation

  • Bernardo Caldarola & Luca Fontanelli, 2024. "Cloud technologies, firm growth and industry concentration: Evidence from France," LEM Papers Series 2024/25, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    • Handle: RePEc:ssa:lemwps:2024/25
    as

    Download full text from publisher

    File URL: http://www.lem.sssup.it/WPLem/files/2024-25.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Domini, Giacomo & Grazzi, Marco & Moschella, Daniele & Treibich, Tania, 2021. "Threats and opportunities in the digital era: Automation spikes and employment dynamics," Research Policy, Elsevier, vol. 50(7).
    2. Vella, Francis & Verbeek, Marno, 1999. "Estimating and Interpreting Models with Endogenous Treatment Effects," Journal of Business & Economic Statistics, American Statistical Association, vol. 17(4), pages 473-478, October.
    3. Clougherty, Joseph A. & Duso, Tomaso & Muck, Johannes, 2016. "Correcting for Self-selection Based Endogeneity in Management Research: Review, Recommendations and Simulations," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 19, pages 286-347.
    4. Bajgar, Matej & Berlingieri, Giuseppe & Calligaris, Sara & Criscuolo, Chiara & Timmis, Jonathan, 2019. "Industry concentration in Europe and North America," LSE Research Online Documents on Economics 103427, London School of Economics and Political Science, LSE Library.
    5. Sergei Guriev & Nikita Melnikov & Ekaterina Zhuravskaya, 2021. "3G Internet and Confidence in Government," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 136(4), pages 2533-2613.
    6. Danial Lashkari & Arthur Bauer & Jocelyn Boussard, 2024. "Information Technology and Returns to Scale," American Economic Review, American Economic Association, vol. 114(6), pages 1769-1815, June.
    7. Peter Gal & Giuseppe Nicoletti & Christina von Rüden & Stéphane Sorbe & Théodore Renault, 2019. "Digitalization and Productivity: In Search of the Holy Grail - Firm-level Empirical Evidence from European Countries," International Productivity Monitor, Centre for the Study of Living Standards, vol. 37, pages 39-71, Fall.
    8. Andrew A. King & Christopher L. Tucci, 2002. "Incumbent Entry into New Market Niches: The Role of Experience and Managerial Choice in the Creation of Dynamic Capabilities," Management Science, INFORMS, vol. 48(2), pages 171-186, February.
    9. Daron Acemoglu & Pascual Restrepo, 2020. "Robots and Jobs: Evidence from US Labor Markets," Journal of Political Economy, University of Chicago Press, vol. 128(6), pages 2188-2244.
    10. Matej Bajgar & Giuseppe Berlingieri & Sara Calligaris & Chiara Criscuolo & Jonathan Timmis, 2019. "Industry concentration in Europe and North America," CEP Discussion Papers dp1654, Centre for Economic Performance, LSE.
    11. Erik Brynjolfsson & Daniel Rock & Chad Syverson, 2018. "Artificial Intelligence and the Modern Productivity Paradox: A Clash of Expectations and Statistics," NBER Chapters, in: The Economics of Artificial Intelligence: An Agenda, pages 23-57, National Bureau of Economic Research, Inc.
    12. Harrigan, James & Reshef, Ariell & Toubal, Farid, 2021. "The March of the Techies: Job Polarization Within and Between Firms," Research Policy, Elsevier, vol. 50(7).
    13. Patrick Puhani, 2000. "The Heckman Correction for Sample Selection and Its Critique," Journal of Economic Surveys, Wiley Blackwell, vol. 14(1), pages 53-68, February.
    14. Jose Manuel Campa & Simi Kedia, 2002. "Explaining the Diversification Discount," Journal of Finance, American Finance Association, vol. 57(4), pages 1731-1762, August.
    15. J. Myles Shaver, 1998. "Accounting for Endogeneity When Assessing Strategy Performance: Does Entry Mode Choice Affect FDI Survival?," Management Science, INFORMS, vol. 44(4), pages 571-585, April.
    16. Erik Brynjolfsson & Lorin M. Hitt, 2003. "Computing Productivity: Firm-Level Evidence," The Review of Economics and Statistics, MIT Press, vol. 85(4), pages 793-808, November.
    17. Heckman, James J, 1978. "Dummy Endogenous Variables in a Simultaneous Equation System," Econometrica, Econometric Society, vol. 46(4), pages 931-959, July.
    18. Caldarola, Bernardo & Grazzi, Marco & Occelli, Martina & Sanfilippo, Marco, 2023. "Mobile internet, skills and structural transformation in Rwanda," Research Policy, Elsevier, vol. 52(10).
    19. James Bessen, 2020. "Industry Concentration and Information Technology," Journal of Law and Economics, University of Chicago Press, vol. 63(3), pages 531-555.
    20. Thomas Barnebeck Andersen & Jeanet Bentzen & Carl-Johan Dalgaard & Pablo Selaya, 2012. "Lightning, IT Diffusion, and Economic Growth Across U.S. States," The Review of Economics and Statistics, MIT Press, vol. 94(4), pages 903-924, November.
    21. Carol Corrado & Jonathan Haskel & Cecilia Jona-Lasinio, 2021. "Artificial intelligence and productivity: an intangible assets approach," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 37(3), pages 435-458.
    22. Cirillo, Valeria & Fanti, Lucrezia & Mina, Andrea & Ricci, Andrea, 2023. "The adoption of digital technologies: Investment, skills, work organisation," Structural Change and Economic Dynamics, Elsevier, vol. 66(C), pages 89-105.
    23. Babina, Tania & Fedyk, Anastassia & He, Alex & Hodson, James, 2024. "Artificial intelligence, firm growth, and product innovation," Journal of Financial Economics, Elsevier, vol. 151(C).
    24. Garrison, Gary & Wakefield, Robin L. & Kim, Sanghyun, 2015. "The effects of IT capabilities and delivery model on cloud computing success and firm performance for cloud supported processes and operations," International Journal of Information Management, Elsevier, vol. 35(4), pages 377-393.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Flavio Calvino & Chiara Criscuolo & Luca Fontanelli & Lionel Nesta & Elena Verdolini, 2024. "The role of human capital for AI adoption: Evidence from French firms," CEP Discussion Papers dp2055, Centre for Economic Performance, LSE.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Flavio Calvino & Luca Fontanelli, 2023. "Artificial intelligence, complementary assets and productivity: evidence from French firms," LEM Papers Series 2023/35, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    2. Flavio Calvino & Luca Fontanelli, 2024. "AI Users Are Not All Alike: The Characteristics of French Firms Buying and Developing AI," CESifo Working Paper Series 11466, CESifo.
    3. Czarnitzki, Dirk & Fernández, Gastón P. & Rammer, Christian, 2023. "Artificial intelligence and firm-level productivity," Journal of Economic Behavior & Organization, Elsevier, vol. 211(C), pages 188-205.
    4. Ian Goldin & Pantelis Koutroumpis & François Lafond & Julian Winkler, 2024. "Why Is Productivity Slowing Down?," Journal of Economic Literature, American Economic Association, vol. 62(1), pages 196-268, March.
    5. Ufuk Akcigit & Sina T. Ates, 2023. "What Happened to US Business Dynamism?," Journal of Political Economy, University of Chicago Press, vol. 131(8), pages 2059-2124.
    6. Venturini, Francesco, 2022. "Intelligent technologies and productivity spillovers: Evidence from the Fourth Industrial Revolution," Journal of Economic Behavior & Organization, Elsevier, vol. 194(C), pages 220-243.
    7. Cortes, Matias & Lerche, Adrian & Schönberg, Uta & Tschopp, Jeanne, 2023. "Technological Change, Firm Heterogeneity and Wage Inequality," IZA Discussion Papers 16070, Institute of Labor Economics (IZA).
    8. Gallipoli, Giovanni & Makridis, Christos A., 2018. "Structural transformation and the rise of information technology," Journal of Monetary Economics, Elsevier, vol. 97(C), pages 91-110.
    9. Nikolas Zolas & Zachary Kroff & Erik Brynjolfsson & Kristina McElheran & David Beede & Catherine Buffington & Nathan Goldschlag & Lucia Foster & Emin Dinlersoz, 2020. "Advanced Technologies Adoption and Use by U.S. Firms: Evidence from the Annual Business Survey," Working Papers 20-40, Center for Economic Studies, U.S. Census Bureau.
    10. Iacovone, Leonardo & Pereira-López, Mariana & Schiffbauer, Marc, 2023. "Competition makes IT better: Evidence on when firms use IT more effectively," Research Policy, Elsevier, vol. 52(8).
    11. Stefano Costa & Federico Sallusti & Claudio Vicarelli & Davide Zurlo, 2021. "Italian firms in times of troubles: Covid-19 pandemic as a test of structural solidity," LEM Papers Series 2021/47, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    12. Garnadt, Niklas & von Rueden, Christina & Thiel, Esther, 2021. "Labour reallocation dynamics in Germany during the COVID-19 pandemic and past recessions," Working Papers 08/2021, German Council of Economic Experts / Sachverständigenrat zur Begutachtung der gesamtwirtschaftlichen Entwicklung.
    13. Anderton, Robert & Jarvis, Valerie & Labhard, Vincent & Morgan, Julian & Petroulakis, Filippos & Vivian, Lara, 2020. "Virtually everywhere? Digitalisation and the euro area and EU economies," Occasional Paper Series 244, European Central Bank.
    14. Erik Brynjolfsson & Wang Jin & Kristina McElheran, 2021. "The power of prediction: predictive analytics, workplace complements, and business performance," Business Economics, Palgrave Macmillan;National Association for Business Economics, vol. 56(4), pages 217-239, October.
    15. von Maydell, Richard, 2024. "Artificial Intelligence and its Effect on Competition and Factor Income Shares," VfS Annual Conference 2023 (Regensburg): Growth and the "sociale Frage" 277654, Verein für Socialpolitik / German Economic Association, revised 2024.
    16. Mauro Caselli & Edwin Fourrier-Nicolai & Andrea Fracasso & Sergio Scicchitano, 2024. "Digital Technologies and Firms’ Employment and Training," CESifo Working Paper Series 11056, CESifo.
    17. Arntz, Melanie & Genz, Sabrina & Gregory, Terry & Lehmer, Florian & Zierahn-Weilage, Ulrich, 2024. "De-Routinization in the Fourth Industrial Revolution - Firm-Level Evidence," IZA Discussion Papers 16740, Institute of Labor Economics (IZA).
    18. Charles Hoffreumon & Chris Forman & Nicolas van Zeebroeck, 2024. "Make or buy your artificial intelligence? Complementarities in technology sourcing," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 33(2), pages 452-479, March.
    19. Nucci, Francesco & Puccioni, Chiara & Ricchi, Ottavio, 2023. "Digital technologies and productivity: A firm-level investigation," Economic Modelling, Elsevier, vol. 128(C).
    20. Xie, Xiaoyu & Yan, Jun, 2024. "How does artificial intelligence affect productivity and agglomeration? Evidence from China's listed enterprise data," International Review of Economics & Finance, Elsevier, vol. 94(C).

    More about this item

    Keywords

    cloud; ICT; concentration; firm growth rate; firm performance;
    All these keywords.

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:ssa:lemwps:2024/25. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/labssit.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.