Barriers to investment in ICT

Matteo Bugamelli and Patrizio Pagano ()

No 420, Temi di discussione (Economic working papers) from Bank of Italy, Economic Research and International Relations Area

Abstract: We investigate the diffusion of information and communication technologies (ICT) in Italian manufacturing using microdata. We find a positive correlation at firm level between ICT investment, human capital of the labor force and reorganization. Starting from row data, we build a measure of ICT capital stock, which includes hardware, software and communication equipment, showing a delay in ICT accumulation with respect to US manufacturing, in 1997, of about 8 years. We use this measure to estimate a production function. The elasticity of value added to ICT capital turns out to be close to 4 per cent, which implies an ICT marginal product much higher than its user cost. We argue that this can be explained by the presence of barriers to ICT investment such as the low level of human capital and the lack of reorganization of the firm.

Keywords: New economy; information and communication technologies; firm organization; human capital. (search for similar items in EconPapers)
JEL-codes: D24 L23 O30 (search for similar items in EconPapers)
Date: 2001-10
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Citations: View citations in EconPapers (11)

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Journal Article: Barriers to investment in ICT (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:bdi:wptemi:td_420_01

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