Technological capacity and firms’ recovery from Covid-19

Sebastian Doerr, Magdalena Erdem, Guido Franco, Leonardo Gambacorta and A. Illes

Economics Letters, 2021, vol. 209, issue C

Abstract: Can higher technological capacity help firms to recover quicker from recessions? Analysing the effects of the Covid-19 pandemic on firm revenues in several countries, we find that firms headquartered in jurisdictions with better digital infrastructure generated relatively higher revenue during the shock period. Improving a country’s technological capability by one standard deviation is associated with a relative increase in revenues of the average firm by around 4%. The positive effect of technology is more pronounced among smaller firms, suggesting that it could have helped the recovery of SMEs.

Keywords: Covid-19; Pandemic; Information technology; Crisis; Recovery (search for similar items in EconPapers)
JEL-codes: E23 G10 G38 O30 (search for similar items in EconPapers)
Date: 2021
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Working Paper: Technological capacity and firms' recovery from Covid-19 (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:209:y:2021:i:c:s0165176521003797

DOI: 10.1016/j.econlet.2021.110102

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