Small is big in ICT: The impact of R&D on productivity

Pantelis Koutroumpis, Aija Leiponen and Llewellyn D.W. Thomas

Telecommunications Policy, 2020, vol. 44, issue 1

Abstract: We examine the contribution of R&D to firm productivity in a large panel of European firms and study its variation with the age, size, and sub-sector of firms. We find that R&D capital in ICT firms has a larger effect on revenue when compared to non-ICT firms. At the firm level, our results suggest that, surprisingly, smaller and older ICT firms benefit the most from R&D. Small but mature ICT firms are likely to dominate market niches, and small size may enable them to be flexible and adaptable which helps them respond to technological opportunities to develop innovative products and services. This has important implications for public policy based upon firm age.

Keywords: ICT; R&D; Productivity; Technological opportunity; Firm age; Firm size (search for similar items in EconPapers)
JEL-codes: O12 O32 O33 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (13)

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DOI: 10.1016/j.telpol.2019.101833

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