Does the Internet increase labor productivity? Evidence from a cross-country dynamic panel

Reza Najarzadeh, Farzad Rahimzadeh and Michael Reed

Journal of Policy Modeling, 2014, vol. 36, issue 6, 986-993

Abstract: The Internet has various economic functions and is a fundamental part of most economic activities and transactions. In this paper we apply a Dynamic Panel Data approach to study the impact of the Internet on labor productivity using data from 108 countries for the period 1995–2010. The results of the study show that the Internet has positive and statistically significant effects on labor productivity. Assuming other factors stay constant, increasing the number of Internet users by one percent increases GDP per employed person by $8.16–14.6. Educational expenditures as a percentage of GNI, per capita health expenditures, trade and gross capital formation as a percentage of GDP also have positive and statistically significant effects on labor productivity.

Keywords: Internet; Labor productivity; Dynamic Panel Data; GMM (search for similar items in EconPapers)
JEL-codes: C32 G21 O40 O50 (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (35)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jpolmo:v:36:y:2014:i:6:p:986-993

DOI: 10.1016/j.jpolmod.2014.10.003

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