The impact of ICT adoption on productivity: Evidence from Portuguese firm-level data

João Amador and Cátia Silva

Working Papers from Banco de Portugal, Economics and Research Department

Abstract: In this paper we study the impact of ICT adoption on the level of labour productivity and TFP of Portuguese firms in the period 2004-2018. For this purpose we combine firm-level annual survey data for different dimensions of ICT adoption and balance sheet variables that allow for the computation of productivity and control for several dimensions of heterogeneity. The paper uses a Bartik (1991) shift-share type instrumental variable and results state that there is a positive and sizeable impact from ICT adoption on TFP and labour productivity. One standard deviation increase in the first principal component that captures overall ICT adoption by the firm leads to an increase of 25 percent in TFP and an increase of 58 percent in labour productivity. When the analysis is made separately, online sales and the creation of a website stand out as the most relevant dimensions for productivity gains.

JEL-codes: J24 O3 O4 (search for similar items in EconPapers)
Date: 2023
New Economics Papers: this item is included in nep-bec, nep-eff, nep-ict, nep-sbm and nep-tid
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Persistent link: https://EconPapers.repec.org/RePEc:ptu:wpaper:w202307

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