The Economic Impact of ICT

Measurement, Evidence and Implications

image of The Economic Impact of ICT

Information and communications technology (ICT) has become a key driver of economic growth over the past decade. The rapid diffusion of the Internet, of mobile telephony and of broadband networks all demonstrate how pervasive this technology has become. But how precisely does ICT affect economic growth and the efficiency of firms? And how well can these effects be measured?

This report provides an overview of the economic impact of ICT on economic performance, and the ways through which it can be measured. Using available OECD data, the first part of the book examines the available measures of ICT diffusion, the role and impact of ICT investment and the role of ICT-using and ICT-producing sectors in overall economic performance. The second part of the book offers nine studies for OECD countries, based on detailed firm-level data and prepared by researchers and statisticians from a wide range of OECD countries. These studies use a variety of methods and provide detailed insights on the effects of ICT in individual countries.



Productivity Slowdown and the Role of ICT in Italy

A Firm-Level Analysis

This paper presents a firm-level analysis of the recent productivity slowdown in Italy. It applies Data Envelopment Analysis (DEA) techniques to firm-level data collected through the annual surveys on the economic accounts of enterprises carried out by the Italian National Statistical Institute (ISTAT). The paper also measures TFP changes that occurred during the years 1996-1999 for 31 industries and breaks these down into technological change (a shift in the production frontier) and changes in relative technical inefficiency (due to modifications in the distance of single firms from the frontier). This decomposition is helpful in interpreting the nature of the observed productivity slowdown. Econometric regressions of firms’ TFP changes for a number of variables, including a component pointing to the ratio of ICT in total capital input, reveal that information and communication technologies appears to have had a positive and significant impact on TFP in all industries during the period examined...


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