Does Experience Matter? Innovations and the Productivity of ICT in German Services

Hempell, Thomas

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URL:	http://ub-madoc.bib.uni-mannheim.de/402
URN:	urn:nbn:de:bsz:180-madoc-4021
Document Type:	Working paper
Year of publication:	2002
The title of a journal, publication series:	None
Publication language:	English
Institution:	Sonstige Einrichtungen > ZEW - Leibniz-Zentrum für Europäische Wirtschaftsforschung
MADOC publication series:	Veröffentlichungen des ZEW (Leibniz-Zentrum für Europäische Wirtschaftsforschung) > ZEW Discussion Papers
Subject:	330 Economics
Classification:	JEL: C23 D24 L80 O32 ,
Subject headings (SWD):	Deutschland , Dienstleistungssektor , Innovation
Abstract:	In this paper, it is argued that ICT investment is closely linked with complementary innovations and most productive in firms with innovative experience. In an analysis based on firm–level panel data covering the period 1994–99, system GMM estimates for an extended production function framework reveal significant productivity effects of ICT in the German service sector. Moreover, there is strong support for the hypothesis that the experience gained from past process innovations is a specific feature that makes ICT investment more productive. The results suggest that ICT may have been contributing to productivity differentials between firms.
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