The Impact Of Information Technology On Labor Productivity Growth: Evidence From Five OECD Countries, 1970-1990

Hyunbae Chun

Korean Economic Review, 2007, vol. 23, 5-32

Abstract: This paper examines the impact of information technology (IT) on labor productivity growth using industry-level data for five OECD countries (the United States, Canada, Japan, France, and the United Kingdom), from 1970 to 1990. Empirical findings show that IT investment has a positive effect on labor productivity growth, accounting for about 15 percent of this growth. The benefit of IT investment was on average lower than its cost over the 1970-1990 period, which implies that new IT investment had not been efficiently used in the early period of IT adoption. The benefit per dollar cost was almost two times greater in the 1980s than in the 1970s, which is mainly due to a rapid fall in IT prices.

Keywords: Information Technology; Labor Productivity Growth; IT Productivity Paradox (search for similar items in EconPapers)
JEL-codes: D24 O33 O47 (search for similar items in EconPapers)
Date: 2007
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