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Evidence on the impact of R&D and ICT investment on innovation and productivity in Italian firms

Author

Listed:
  • Bronwyn H. Hall

    (University of California, Berkeley)

  • Francesca Lotti

    (Bank of Italy)

  • Jacques Mairesse

    (CREST-INSEE)

Abstract

The paper investigates R&D and ICT investment at firm level, assessing their relative importance and the extent to which they are complements or substitutes. We use data on a large unbalanced panel sample from four consecutive waves of a survey of Italian manufacturing firms, together with a version of the model developed by Crepon et al., 1998, modified to include ICT investment and R&D as the two main inputs of innovation and productivity. We find that R&D and ICT are both strongly associated with innovation and productivity, with R&D being more important for innovation and ICT for productivity. We explore their possible complementarity in innovation and production but find none, although there is complementarity between R&D and worker skill in innovation.

Suggested Citation

  • Bronwyn H. Hall & Francesca Lotti & Jacques Mairesse, 2012. "Evidence on the impact of R&D and ICT investment on innovation and productivity in Italian firms," Temi di discussione (Economic working papers) 874, Bank of Italy, Economic Research and International Relations Area.
    • Handle: RePEc:bdi:wptemi:td_874_12
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    References listed on IDEAS

    as
    1. Lorenzo Cappellari & Stephen P. Jenkins, 2006. "Calculation of multivariate normal probabilities by simulation, with applications to maximum simulated likelihood estimation," Stata Journal, StataCorp LP, vol. 6(2), pages 156-189, June.
    2. Nathalie Greenana & Jacques Mairesse, 2000. "Computers And Productivity In France: Some Evidence," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 9(3), pages 275-315.
    3. Bart van Ark & Robert Inklaar & Robert H. McGuckin, 2003. "ICT and Productivity in Europe and the United States Where Do the Differences Come From?," CESifo Economic Studies, CESifo Group, vol. 49(3), pages 295-318.
    4. G. M.P. Swann, 2009. "The Economics of Innovation," Books, Edward Elgar Publishing, number 13211.
    5. Bruno Crepon & Emmanuel Duguet & Jacques Mairesse, 1998. "Research, Innovation And Productivity: An Econometric Analysis At The Firm Level," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 7(2), pages 115-158.
    6. Hall, Bronwyn H. & Lerner, Josh, 2010. "The Financing of R&D and Innovation," Handbook of the Economics of Innovation, in: Bronwyn H. Hall & Nathan Rosenberg (ed.), Handbook of the Economics of Innovation, edition 1, volume 1, chapter 0, pages 609-639, Elsevier.
    7. Rachel Griffith & Elena Huergo & Jacques Mairesse & Bettina Peters, 2006. "Innovation and Productivity Across Four European Countries," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 22(4), pages 483-498, Winter.
    8. Sandra E. Black & Lisa M. Lynch, 2001. "How To Compete: The Impact Of Workplace Practices And Information Technology On Productivity," The Review of Economics and Statistics, MIT Press, vol. 83(3), pages 434-445, August.
    9. Jacques Mairesse, 2008. "Employment, innovation, and productivity: evidence from Italian microdata," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 17(4), pages 813-839, August.
    10. Bronwyn Hall & Francesca Lotti & Jacques Mairesse, 2009. "Innovation and productivity in SMEs: empirical evidence for Italy," Small Business Economics, Springer, vol. 33(1), pages 13-33, June.
    11. Matteo Bugamelli & Patrizio Pagano, 2004. "Barriers to investment in ICT," Applied Economics, Taylor & Francis Journals, vol. 36(20), pages 2275-2286.
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    More about this item

    Keywords

    R&D; ICT; innovation; productivity; complementarity; Italy;
    All these keywords.

    JEL classification:

    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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