Advertisement

ICT, Productivity and Organizational Complementarit

  • Marcello Martinez
Chapter

Abstract

Recent years have witnessed a surge in interest in Information Technology (IT) and its impact on productivity. The paper presents the analysis of the literature that has analyzed how firms’ skills and organizational change affect the returns from investments in ICT. According to the skill-biased technical change (SBTC) hypothesis technological change, and particularly the adoption of ICTs, increases the demand for skilled labour with respect to unskilled labour and leads to increasing wage inequality. On the contrary the skill-biased organizational change hypothesis (SBOC) sustains that the adoption of new organizational systems based on decentralized decision-making and delayering calls for more skilled people. Because of the complementarity between new organizational systems and skilled labour firms that adopt the two complements are expected to outperform firms that use only one of them. However SBTC and SBOC hypotheses are the two sides of the same coin. Drawing on the mixed empirical evidence reported in studies that have tried to test the SBTC, literature has introduced the concept of organizational complementarity between ICT and skilled labour. In this perspective, technological and organizational change together call for more skilled labour.

Keywords

Organizational Change Wage Dispersion Skilled Staff Productivity Paradox Smart Machine 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

References

  1. 1.
    Strassmann, P. A. (1990) The Business Value of Computers: An Executive’s Guide. New Canaan, CT, Information Economics Press.Google Scholar
  2. 2.
    Loveman, G. W. (1988) An Assessment of the Productivity Impact of Information Technologies. MIT Management in the 1990s, Working Paper # 88 – 05, July 1988Google Scholar
  3. 3.
    Bender, D. H. [1986] Financial Impact of Information Processing. Vol. 3(2), 22-32 4. Roach, S. S. (1989) America’s White-Collar Productivity Dilemma. Manufacturing Engineering, August, pp. 104.Google Scholar
  4. 4.
    Becchetti, L., Paganetto, L., and Bedoya, D.A.L. (2003) ICT Investment, Productivity and Efficiency: Evidence at Firm Level Using a Stochastic Frontier Approach. Research paper CEIS, n. 29.Google Scholar
  5. 5.
    Lehr, B., and Lichtenberg, F.(1999) Information Technology and Its Impact on Productivity: Firm- Level Evidence from Government and Private Data Sources, 1977-1993. Canadian Journal of Economics; 32(2), 335-62.CrossRefGoogle Scholar
  6. 6.
    David, P. (1990) The Dynamo and the Computer: An Historical Perspective on the Modern Productivity Paradox. American Economic Review, 80(2), 355-61.Google Scholar
  7. 7.
    Dedrick, J., Gurbaxani, V., and Kraemer, K. L. (2002) Information Technology and Economic Performance: Firm and Country Evidence, Center for Research on Information Technology and Organizations, University of California, Irvine.Google Scholar
  8. 8.
    Zuboff, S. (1988) In the Age of the Smart Machine: the Future of Work and Power, Basic Books, New York, NY.Google Scholar
  9. 9.
    Zuboff, S. (1982) New Worlds of Computer Mediated Work, Harvard Business Review, September-October.Google Scholar
  10. 10.
    Malone, T. W., Yates, J., Benjamin, R. I. (1987) Electronic Market and Electronic Hierarchies. Communication of the ACM, June, 30(6)Google Scholar
  11. 11.
    Gurbaxani, V.,and Whang S. (1991) The impact of information systems on organizations and markets. Communications of the ACM 34(1): 59-73.CrossRefGoogle Scholar
  12. 12.
    Brynjolfsson, E. and Hitt, L. (2001) Beyond Computation: Information Technology, Organizational Transformation, and Business Performance, Journal of Economic Perspectives, forthcoming.Google Scholar
  13. 13.
    Bakos, J. Y., and Brynjolfsson, E. (1993b) Information Technology, Incentives and the Optimal Number of Suppliers. Journal of Management Information Systems, 10(2) (Fall).Google Scholar
  14. 14.
    Clemons, E. K., Reddi, S. P., and Row, M. C. (1993) The Impact of Information Technology on the Organization of Economic Activity. The <<Move to the Middle>> Hypothesis. Journal of Management Information Systems, 10(2) Fall.Google Scholar
  15. 15.
    OECD (2009), OECD Science, Technology and 12 industry scoreboard 2009Google Scholar
  16. 16.
    Nurmilaakso, J.M. (2009) ICT solutions and labor productivity: evidence from firm-level data. Electronic Commerce Research 9, 173–181CrossRefGoogle Scholar
  17. 17.
    Giuri, P., Torrisi, S., Zinovyeva, N. (2005) ICT, Skills and Organisational Change: Evidence from a Panel of Italian Manufacturing Firms, LEM working paper #2005/11, Sant’Anna School of Advanced Studies, Pisa.Google Scholar
  18. 18.
    Bresnahan, T. (1999) Computerisation and Wage Dispersion: An Analytical Reinterpretation, Economic Journal 109, F390-F415.CrossRefGoogle Scholar
  19. 19.
    Bresnahan, T., Brynjolfsson, E., and Hitt, L. (2002) Information Technology, Workplace Organization and the Demand for Skilled Labor: Firm-level Evidence. Quarterly Journal of Economics, Feb., pp. 339-376.Google Scholar
  20. 20.
    Arvanitis, S. (2005) Computerization, New Workplace Organization, Skilled Labor and Firm Productivity: Evidence for the Swiss Business Sector. Economics of Innovation and New Technology, 14, 225-249.CrossRefGoogle Scholar
  21. 21.
    Machin, S.,and Van Reenen, J. (1998) Technology and Changes in Skills Structure: Evidence from Seven OECD Countries, The Quarterly Journal of Economics, November, pp. 1215-44.Google Scholar
  22. 22.
    Autor, D.H., Katz F.L., and Krueger A.B. (1998) Computing Inequality: Have Computers Changed the Labor Market? Quarterly Journal of Economics, 113, 1169-1213.CrossRefGoogle Scholar
  23. 23.
    Acemoglu, D. (1998) Why do new technologies complement skills? Directed technical change and wage inequality. Quarterly Journal of Economics 113, 1055–1090.CrossRefGoogle Scholar
  24. 24.
    Bratti, M.,and Matteucci, N. (2004) Is There Skill-Biased Technicological Change in Italian Manufacturing? Evidence from Firm-Level Data, Quaderni di ricerca, No. 202, Dipartimento di Economia, Università Politecnica delle Marche.Google Scholar
  25. 25.
    Manacorda, M. (1996) Dualismo territoriale e differenziali di reddito. Un’analisi dell’andamento della dispersione dei redditi individuali nel Nord e Sud d’Italia, mimeo.Google Scholar
  26. 26.
    Erickson, C.L., Ichino, A.C. (1994) Wage differentials in Italy: Market force, Institutions and Inflation in Differences and Changes in the Wage Structure, Freeman R. and Katz L. F.(eds), Chicago University Press and NBER, 105-127.Google Scholar
  27. 27.
    Casavola, P., Gavosto, A., and Sestito, P., (1996) Technical progress and wage dispersion in Italy: evidence from data. Annales d’economie et statistique, 41-42, 387-412Google Scholar
  28. 28.
    Piva, M., Santarelli E., and Vivarelli M. (2005) The skill bias effect of technological and organizational change: Evidence and policy implications. Research Policy, 34, 141-157.CrossRefGoogle Scholar
  29. 29.
    Caroli, E. and Van Reenen, J. (2001) Skill-Biased Organizational Change? Evidence from Panel of British and French Establishments. Quarterly Journal of Economics, Nov., pp. 1449-1492.Google Scholar
  30. 30.
    Piva,, M., and Vivarelli, M. (2004) The Determinants of the Skill Bias in Italy: R&D, Organization or Globalization? Economics of Innovation and New Technology, 13(4), 329-347.CrossRefGoogle Scholar
  31. 31.
    Bloom, N., Van Reenen, J. and Sadun, R. (2005) It Ain’t What You Do, it’s the Way that You do IT, Centre for Economic Performance, London School of Economics: LondonGoogle Scholar
  32. 32.
    Farooqui, S. (2005) IT use by Firms and Employees, Productivity Evidence across Industries. Economic Trends, 625, 65–74Google Scholar
  33. 33.
    McKinsey (2004)Google Scholar
  34. 34.
    OECD (2004) Working Party on the Information Economy: New Perspectives on ICT Skills and Employment, DSTI/ICCP/IE(2004)10, Paris, December 2004.Google Scholar
  35. 35.
    Maliranta, M., and Rouvinen, P. (2004) ICT and Business Productivity: Finnish Microlevel Evidence. Office for Economic Co-operation and Development publication: The Economic Impact of ICT: Measurement, Evidence and ImplicationsGoogle Scholar
  36. 36.
    Gretton, P., Gali, J. and D. Parham (2002), Uptake and Impacts of ICT in the Australian Economy: Evidence from Aggregate, Sectoral and Firm levels, Paper Presented in The OECD Workshop on ICT and Business Performance, Paris, December 9.Google Scholar
  37. 37.
    Bertschek, I. Kaiser, U. (2004) Productivity Effects of Organizational Change: Microeconometric Evidence. Management Science, 50(3), 394-404.CrossRefGoogle Scholar
  38. 38.
    Hempel, T. (2002) Does experience matter? Productivity effects of ICT in the German service sector. Discussion paper 02–43. Centre for European Economic Research: ManheimGoogle Scholar
  39. 39.
    Bloom N., Sadun R., and Van Reenen J., (2007) Americans do I.T. Better: U.S. Multinationals and the Productivity Miracle, NBER Working Paper No. 13085.Google Scholar
  40. 40.
    Galbraith, J. R. (1977) Organizational Design, Addison Wesley, Reading, MA. 42. Trento, S.,and Warglein M. (2001), Nuove tecnologie e cambiamenti organizzativi: alcune implicazioni per le imprese italiane, Banca d’Italia, Temi di discussion, Number 428 – December.Google Scholar
  41. 41.
    Bugamelli, M., and Pagano P., (2001) Barriers to Investment in ICT. Banca d’Italia, Temidi discussione Number 420 – October.Google Scholar
  42. 42.
    Matteucci, N., Sterlacchini, A. (2004) ICT, R&D and Productivity Growth: Evidence fromItalian Manufacturing Firms, EPKE Final Conference “Information Technology,Productivity and Growth, London, 28-29 October.Google Scholar
  43. 43.
    Zhen-Wei Qiang, C., Pitt, A., and Ayers, S. (2004) Contribution of Information andCommunication Technologies to Growth W O R L D B A N K W O R K I N G P A P E R N O. 2 4 Google Scholar

Copyright information

© Springer-Verlag Berlin Heidelberg 2011

Authors and Affiliations

  1. 1.Dipartimento di Strategie aziendaliSeconda università di NapoliNaplesItaly

Personalised recommendations