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More bits - more bucks? Measuring the impact of broadband internet on firm performance

Irene Bertschek, Daniel Cerquera and Gordon Klein ()

No 11-032, ZEW Discussion Papers from ZEW - Leibniz Centre for European Economic Research

Abstract: The paper provides empirical evidence for the causal impact of broadband Internet on the economic performance of German firms. Performance is measured in terms of labour productivity and realised process and product innovations. The analysis refers to the early phase of DSL expansion in Germany from 2001 to 2003, when roughly 60 percent of the German firms already used broadband Internet. Identification relies on instrumental variable estimation taking advantage of information on the availability of DSL broadband at the postal code level. The results show that broadband Internet has no impact on firms' labour productivity whereas it exhibits a positive and significant impact on their innovation activity.

Keywords: labour productivity; innovation; broadband Internet (search for similar items in EconPapers)
JEL-codes: D22 L23 O31 (search for similar items in EconPapers)
Date: 2011
New Economics Papers: this item is included in nep-eff, nep-ict and nep-ino
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Working Paper: More bits - more bucks? Measuring the impact of broadband internet on firm performance (2013) Downloads
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