Enterprise information and communications technology software pricing and developer productivity measurement

Martin Fleming

Review of Income and Wealth, 2025, vol. 71, issue 1

Abstract: The 1999 addition of business sector software and services spending to the National Income and Product Accounts was an important innovation, achieving a novel focus on the measurement of intangible asset investment. Over the intervening years, enterprise information and communication technology (ICT) has fundamentally changed. The transformation has raised questions about the extent of the decline of ICT function software prices. As a software producing sector, the business sector ICT function now has a much wider array of production factor choices. In addition, labor and multifactor software development productivity, an important sources of value creation, varies widely from year to year. With the use of a two‐sector model and a standard growth accounting framework, a business sector ICT function shadow price is estimated, finding that software price declines have been underestimated by 4.4 percentage points (ppt) over 2015 to 2021. The impact on GDP growth is a 0.1 ppt underestimate. Correcting the underestimate increases software spending from 19.6% to 24.7% of nonresidential fixed investment, and from 47.4% to 59.9% of real intellectual property product spending.

Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
https://doi.org/10.1111/roiw.12711

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:revinw:v:71:y:2025:i:1:n:e12711

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0034-6586

Access Statistics for this article

Review of Income and Wealth is currently edited by Conchita D'Ambrosio and Robert J. Hill

More articles in Review of Income and Wealth from International Association for Research in Income and Wealth Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().