New digital technologies and firm performance in the Italian economy

Valeria Cirillo, Lucrezia Fanti, Andrea Mina and Andrea Ricci

Industry and Innovation, 2023, vol. 30, issue 1, 159-188

Abstract: New digital technologies can generate substantial gains for adopting businesses. In this paper we analyse the impact of new technologies associated with the Industry 4.0 paradigm on labour productivity, average wages and sales growth. The analysis is based on microdata produced by the Italian National Institute for the Analysis of Public Policies (INAPP) on a large representative sample of Italian firms. We merge INAPP data with Orbis data covering the period 2010–2014-2018. By applying a Diff-in-Diff methodology, we show that the economic size of the effect of new technologies on productivity and sales is approximately twice as large as the effect on average wages. The positive impact is stronger for small and medium-size firms, even though the effects appear to be concentrated among more mature rather than younger firms and are heterogeneaous along the distributions. Results are robust to unobserved heterogeneity and endogeneity issues.

Date: 2023
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DOI: 10.1080/13662716.2022.2055999

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