nep-tid New Economics Papers
on Technology and Industrial Dynamics
Issue of 2022‒02‒28
nine papers chosen by
Fulvio Castellacci
Universitetet i Oslo

  1. Return of the Solow-paradox in AI? AI-adoption and firm productivity By Bäck, Asta; Hajikhani, Arash; Jäger, Angela; Schubert, Torben; Suominen, Arho
  2. Automation and Related Technologies: A Mapping of the New Knowledge Base By Santarelli, Enrico; Staccioli, Jacopo; Vivarelli, Marco
  3. Robots and Firm Investment By Efraim Benmelech; Michal Zator
  4. Enterprises Providing ICT Training in Europe By Laureti, Lucio; Costantiello, Alberto; Matarrese, Marco Maria; Leogrande, Angelo
  5. Agglomeration and Technological Specialization By Basheer Kalash
  6. The evolving contribution of R&D, advertising and capital expenditures for US-listed firms’ growth in sales, 1979-2018. A quantile regression analysis By Joel Rabinovich
  7. E-commerce During Covid: Stylized Facts from 47 Economies By Ms. Prachi Mishra; Alberto Cavallo; Mr. Antonio Spilimbergo
  8. Geography, Growth and Inequalities: Market Failures and Public Policy Implications By Benjamin Montmartin
  9. Digitalisation in Italy: evidence from a new regional index By Andrea Benecchi; Carlo Bottoni; Emanuela Ciapanna; Annalisa Frigo; Aldo Milan; Elisa Scarinzi

  1. By: Bäck, Asta (VTT); Hajikhani, Arash (VTT); Jäger, Angela (Fraunhofer Institute for Systems and Innovation Research ISI); Schubert, Torben (CIRCLE, Lund University); Suominen, Arho (VTT)
    Abstract: AI-related technologies have become ubiquitous in many business contexts. However, to date empirical accounts of the productivity effects of AI-adoption by firms are scarce. Using Finnish data on job advertisements between 2013 and 2019, we identify job advertisements referring to AI-related skills. Matching this data to productivity data from ORBIS, we estimate the productivity effects of AI related activities in our sample. Our results indicate that AI-adoption increases productivity, with three important qualifications. Firstly, effects are only observable for large firms with more than 499 employees. Secondly, there is evidence that early adopters did not experience productivity increases. This may be interpreted as technological immaturity.Thirdly, we find evidence of delays of least three years between the adoption of AI and ensuing productivity effects (investment delay effect). We argue that our findings on the technological immaturity and the investment delay effect may help explain the so-called AI-related return of the Solow-paradox: I.e. that AI is everywhere except in the productivity statistics.
    Keywords: Recruiting personnel; AI related jobs; Artificial Intelligence; Job Market; Text Mining; Firm performance; Productivity
    JEL: D22 D24 O31 O32
    Date: 2022–02–15
  2. By: Santarelli, Enrico (University of Bologna); Staccioli, Jacopo (Università Cattolica del Sacro Cuore); Vivarelli, Marco (Università Cattolica del Sacro Cuore)
    Abstract: Using the entire population of USPTO patent applications published between 2002 and 2019, and leveraging on both patent classification and semantic analysis, this paper aims to map the current knowledge base centred on robotics and AI technologies. These technologies are investigated both as a whole and distinguishing core and related innovations, along a 4-level core-periphery architecture. Merging patent applications with the Orbis IP firm-level database allows us to put forward a twofold analysis based on industry of activity and geographic location. In a nutshell, results show that: (i) rather than representing a technological revolution, the new knowledge base is strictly linked to the previous technological paradigm; (ii) the new knowledge base is characterised by a considerable – but not impressively widespread – degree of pervasiveness; (iii) robotics and AI are strictly related, converging (particularly among the related technologies and in more recent times) and jointly shaping a new knowledge base that should be considered as a whole, rather than consisting of two separate GPTs; (iv) the US technological leadership turns out to be confirmed (although declining in relative terms in favour of Asian countries such as South Korea, China and, more recently, India).
    Keywords: robotics, artificial intelligence, general purpose technology, technological paradigm, industry 4.0, patents full-text
    JEL: O33
    Date: 2022–01
  3. By: Efraim Benmelech; Michal Zator
    Abstract: Automation technologies, and robots in particular, are thought to be massively displacing workers and transforming the future of work. We study firm investment in automation using cross-country data on robotization as well as administrative data from Germany with information on firm-level automation decisions. Our findings suggest that the impact of robots on firms has been limited. First, investment in robots is small and highly concentrated in a few industries, accounting for less than 0.30% of aggregate expenditures on equipment. Second, recent increases in robotization do not resemble the explosive growth observed for IT technologies in the past, and are driven mostly by catching-up of developing countries. Third, robot adoption by firms endogenously responds to labor scarcity, alleviating potential displacement of existing workers. Fourth, firms that invest in robots increase employment, while total employment effect in exposed industries and regions is negative, but modest in magnitude. We contrast robots with other digital technologies that are more widespread. Their importance in firms’ investment is significantly higher, and their link with labor markets, while sharing some similarities with robots, appears markedly different.
    JEL: E22 E24 E25 G31 J23 J24 J3
    Date: 2022–01
  4. By: Laureti, Lucio; Costantiello, Alberto; Matarrese, Marco Maria; Leogrande, Angelo
    Abstract: The determinants of enterprises providing ICT training in Europe are analyzed in this article. Data are collected from the European Innovation Scoreboard-EIS of the European Commission for 36 European countries in the period 2000-2019. Data are analyzed with Panel Data with Fixed Effects, Panel Data with Random Effects, Dynamic Panel, WLS and Pooled OLS. Results show that the number of enterprises providing ICT training in Europe is positively associate with “Innovation Index”, “Innovators”, “New Doctorate Graduates”, “Tertiary Education” and negatively associated with “Government Procurement of Advanced Technology Products”, “Human Resources”, and “Marketing or Organisational Innovators”. In adjunct a cluster analysis is performed by using k-Means algorithm optimized with the Silhouette Coefficient and we find the presence of four clusters. Finally, we use eight different machine learning algorithms to predict the value of the enterprises providing ICT training in Europe. We found that the Simple Tree Regression is the best predictor and that the number of enterprises providing ICT training in Europe is expected to growth of the 5,02%.
    Keywords: Innovation and Invention: Processes and Incentives; Management of Technological Innovation; Technological Change: Choices and Consequences; Intellectual Property and Intellectual Capital.
    JEL: O30 O31 O32 O33 O34
    Date: 2022–01–29
  5. By: Basheer Kalash (Université Côte d'Azur; GREDEG CNRS; Sciences Po, OFCE, France)
    Abstract: Notable attention has been given to the relationship between agglomeration and innovation. However, there is a lack of evidence of how agglomeration affects the type of innovation produced. This study aims to causally assess the impact of a change in agglomeration economies, via transportation improvements, on regional technological specialization. It investigates this relationship using the inauguration of the Öresund Bridge between Sweden and Denmark in 2000 as a quasi-experiment for a difference-in-difference approach. It considers the Öresund area, which consists of Copenhagen and the Swedish Skåne, as the treated regions and the other regions in Denmark and Sweden as a control group. The International Patent Classification (IPC) codes of European Patent Office (EPO) applications are employed to define technology classes for 30 NUTS-3 regions in Sweden and Denmark from 1988 to 2011. The results show that the opening of the Öresund bridge led to an increase in Skåne's highly cited patent technology classes, but no significant change in the specialization of Copenhagen. The results suggest that changes in regions' specializations are not only dependent on the quality of patent technology classes but are also region-specific.
    Keywords: Agglomeration, technological specialization, Öresund, transportation infrastructure, innovation
    JEL: O31 O33 R11
    Date: 2022–01
  6. By: Joel Rabinovich (City University London)
    Abstract: This article presents new insights on the evolving contribution of different types of investments to the growth in sales of US nonfinancial listed firms during the 1979-2018 period. By means of quantile regressions it is observed an increasing contribution over time of intangible investment vis-à-vis a decline in capital expenditure both for high-growth and slow-growth firms. However, the impact of different types of intangible investment differs depending on the kind of firm. Whereas research and development (R&D) has a positive contribution for high-growth firms, only advertising has a positive effect for their slow-growth peers.
    Keywords: Firm growth,Fast-growth firms,Quantile Regression,Intangibles
    Date: 2022–01–21
  7. By: Ms. Prachi Mishra; Alberto Cavallo; Mr. Antonio Spilimbergo
    Abstract: We study e-commerce across 47 economies and 26 industries during the COVID-19 pandemic using aggregated and anonymized transaction-level data from Mastercard, scaled to represent total consumer spending. The share of online transactions in total consumption increased more in economies with higher pre-pandemic e-commerce shares, exacerbating the digital divide across economies. Overall, the latest data suggest that these spikes in online spending shares are dissipating at the aggregate level, though there is variation across industries. In particular, the share of online spending in professional services and recreation has fallen below its pre-pandemic trend, but we observe a longer-lasting shift to digital in retail and restaurants.
    Keywords: COVID-19, Technological Change, consumption, digitalization; e-commerce
    Date: 2022–01–28
  8. By: Benjamin Montmartin (SKEMA Business School; Université Côte d'Azur; OFCE Sciences.Po; GREDEG CNRS)
    Abstract: We propose a unique market and social planner solution for a generalized new economic geography and growth model that highlights the importance of taking into account the existence of agglomeration externalities in the analysis of market failures and public policies. Our model disentangles the underinvestment in R&D and the suboptimal growth link present in the previous endogenous growth model. Consequently, our framework allows the market economy to reach various steady-state situations. By evaluating the effects of two strategic policies implemented in the European Union, namely, an innovation and a cohesion policy, we highlight that the complementarity or substitutability of these policies to bring the economy closer to its optimum is directly related to the hypothesis made on the link between agglomeration and growth.
    Keywords: Agglomeration, growth, spatial income inequality, innovation and cohesion policies
    JEL: F43 H50 R12
    Date: 2022–01
  9. By: Andrea Benecchi (Bank of Italy); Carlo Bottoni (Bank of Italy); Emanuela Ciapanna (Bank of Italy); Annalisa Frigo (Bank of Italy); Aldo Milan (AGCOM); Elisa Scarinzi (Bank of Italy)
    Abstract: The geographic digital divide has a significant, though largely unexplored, dimension within a country. This paper proposes an index of digital development for the Italian NUTS2 regions (rDESI) based on the European Commission’s Digital Economy and Society Index (DESI). The rDESI monitors the regional digital divide across five dimensions: (i) the infrastructure and the network usage (connectivity), (ii) the population’s digital skills, (iii) the use of internet services by households, (iv) the integration of ICT by firms, and (v) the level of digital services offered by local government. Southern regions tend to lag behind in most of these dimensions, even if infrastructures and the quality of connectivity appears quite homogeneous across the country. In the last part of the paper, we highlight the limitations of the DESI methodology, proposing some improvements.
    Keywords: digitalization, connectivitym DESI, regional divergence
    JEL: C43 C80 L96 R10
    Date: 2021–12

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