Evidence on the Impact of R&D and ICT Investment on Innovation and Productivity in Italian Firms
52 Pages Posted: 2 Oct 2012
Date Written: July 26, 2012
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.
Keywords: R&D, ICT, innovation, productivity, complementarity, Italy
JEL Classification: L60, O31, O33
Suggested Citation: Suggested Citation