Innovation, accumulation and assimilation: Three sources of productivity growth in ICT industries

The purpose of this article is to explore the sources of labour-productivity growth in ICT (Information and Communication Technologies) sector in a set of developed countries. The appropriate technology theory extended with non-immediate spillovers is the theoretical framework used, while the decomposition analysis is carried out from a non-parametric approach. Obtained results point that high labour-productivity growth rates are mainly due to technical change and, to a lower extent, to capital intensification, while differences in speed of spillover assimilation has not been enough to shorten the existing distances to new frontiers (excluding USA). Policies that affect the incentives to invest in physical capital, as well as to create new knowledge and to favour the willingness to adapt to change are needed to foster labour-productivity growth in an industry that has a leading role for economic growth and social progress of nations in the 21st century.ICT Productivity Malmquist index Localized innovation Catching up Hedonic prices