ICT productivity and firm propensity to innovative investment: Evidence from Italian microdata

Employing a large and detailed data set from Italian manufacturing firms, we provide some insight into the link between information and communication technology (ICT), productivity and the innovative level of investment. Our results support the hypothesis that ICT is different from conventional capital in the rate of technological progress, the compatibility between old and new capital and the extent of learning by doing. We compute ICT marginal productivity across different clusters of firms and its impact on output growth. Depending on their attitude to innovation, firms are found to be appreciably more ICT productive when non-leading technologies are adopted. We find that ICT has a disproportionately wide impact on growth compared to the share in total investment that it represents.