Productivity, technological innovations and broadband connectivity: firm-level evidence for ten European countries

Eric J. Bartelsman, Martin Falk, Eva Hagsten, Michael Polder

Research output: Contribution to JournalArticleAcademicpeer-review

Abstract

This study investigates the link between productivity and innovations (technological as well as non-technological), taking into account the information and communication technology (ICT) intensity of firms, measured as the proportion of broadband internet connected employees. The analysis is based on official firm-level data on innovation activities and ICT usage in firms for the years 2002–2010, linked to the business registers and the production statistics in ten European countries. The datasets encompass 117,000 firm-year observations. Estimation results reveal that firm productivity is significantly related to product innovations, but to a lesser extent than broadband connected employees. The strength of the association varies across countries and between manufacturing and service firms. As a contrast, process, marketing and organizational innovations are not significantly related to productivity in the majority of countries. Overall, broadband usage appears to be a better predictor of productivity than product innovations.

LanguageEnglish
JournalEurasian Business Review
DOIs
StateAccepted/In press - 2019

Fingerprint

Broadband
Technological innovation
Productivity
European countries
Connectivity
Product innovation
Information and communication technology
Employees
Proportion
Process innovation
Innovation activities
Predictors
Manufacturing firms
Statistics
Firm-level data
Organizational innovation
Firm productivity
Marketing innovation
Service firms
World Wide Web

Keywords

  • Broadband usage
  • Firm behavior
  • Firm-level data
  • Productivity
  • Technological innovations

Cite this

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abstract = "This study investigates the link between productivity and innovations (technological as well as non-technological), taking into account the information and communication technology (ICT) intensity of firms, measured as the proportion of broadband internet connected employees. The analysis is based on official firm-level data on innovation activities and ICT usage in firms for the years 2002–2010, linked to the business registers and the production statistics in ten European countries. The datasets encompass 117,000 firm-year observations. Estimation results reveal that firm productivity is significantly related to product innovations, but to a lesser extent than broadband connected employees. The strength of the association varies across countries and between manufacturing and service firms. As a contrast, process, marketing and organizational innovations are not significantly related to productivity in the majority of countries. Overall, broadband usage appears to be a better predictor of productivity than product innovations.",
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Productivity, technological innovations and broadband connectivity : firm-level evidence for ten European countries. / Bartelsman, Eric J.; Falk, Martin; Hagsten, Eva; Polder, Michael.

In: Eurasian Business Review, 2019.

Research output: Contribution to JournalArticleAcademicpeer-review

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