Diapositive 1

1
Some remarks on Eric J. Bartelsmans presentation
Gilbert Cette Banque de France Université de la
Méditerranée April 2008
2
Introduction (1/1)

• Global agreement with Erics presentation
• Some complementary remarks
• 1. Limits of individual data
• 2. ICT diffusion and productivity growth
• 3. ICT diffusion differences between countries
• 4. Policy questions

3
1. Limits of individual data (1/1)

• Several types of specific limits
• Two important ones for productivity studies
• No measure of output price at the individual
  level
• Use of industry level prices
• Difficulties for international productivity
  level comparison
• Convergence process to technological frontier
  difficult to analyse

4
2. ICT diffusion and productivity growth (1/2)

• Impact of ICT on productivity convergence or
  divergence
• At the macro level (national or industry level)
• Numerous studies characterise the important role
  of ICT production and diffusion
• For example, growth accounting approaches
• With individual data few studies
• But important results
• An example from an ongoing Banque de France
  study
• The higher the initial individual productivity
  level, the higher the positive productivity
  impact of the same ICT use
• ICT use could create productivity divergence
  between firms

5
2. ICT diffusion and productivity growth (2/2)
ICT Firm level evidence French firm dataset
(FiBEn)

6
3. ICT diffusion differences (1/4)
No reduction of large diffusion differences
ICT investment rate
As a of GDP
As a of non residential GFCF
Ea excl. Luxembourg for 1991 to 2003 excl.
Luxembourg and Greece for 2004, excl.
Luxembourg, Greece and Belgium for 2005, France,
Germany, Italy, Spain and Ireland for 2006
Sources OECD, Eurostat
7
3. ICT diffusion differences (2/4)

• Rigidities seem to play a role to explain these
  differences

ICT diffusion and rigidities (2003)
4,0
AU
4,0
US
AU
US
3,5
NZ
GB
3,5
GB

NZ
SE
DK
DK
SE
JP
3,0
JP
3,0
NL
NL
FI
BE
BE
FI
2,5
2,5
CA
CA
Share of current price ICT investment in GDP ()
FR
FR
ICT investment rate -
AT
AT
NO
NO
2,0
2,0
ES
GE
PT
GR
GE
GR
ES
IT
IT
PT
1,5
y -0,487x 3,572
1,5
y -1,731x 4,864
R
2
0,236
R
2
0,399
1,0
0,5
1,0
1,5
2,0
2,5
3,0
3,5
1,0
0,8
0,9
1,0
1,1
1,2
1,3
1,4
1,5
1,6
1,7
1,8
1,9
2,0
Labour market rigidity index
Product market rigidity index
Sources OECD
8
3. ICT diffusion differences (3/4)

• Important role of education and rigidities

Aghion, Askenazy, Bourles, Cette, Dromel (2007)
Panel 17 OECD countries, 1985-2003, 138 obs
Instrumental variables econometric estimation
Countries fixed effects

Significant    1 level    5 level 
10 level
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3. ICT diffusion differences (4/4)

• Positive correlation between ICT use at home and
• ICT use in firms
• Household Internet connexion (2004) and ICT
  investment rate (2003)

4
AT
US

y 0,022x 1,567
FI
DK
R
2
0,21
JP
3
ICT investment rate -
CA
GB
NL
GR
IT
NO
SP
AU
2
GE
PT
FR
1
15
20
25
30
35
40
45
50
55
60
65
70
Household Internet connexion rate -
10
4. Policy questions (1/1)

• To catch up with the top countries ICT use
  (mainly US), continental Europe has mainly to
• Increase the proportion of the working age
  population with a third level education degree
• Spontaneous evolution if we consider the
  proportion among young population
• Decrease rigidities on labour and product markets
• Ongoing process?