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Information technology investment and productivity growth in Korea

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  • Information technology investment and productivity growth in Korea
  • Jong Il Kim
  • The Korean Economic Association


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Title Information technology investment and productivity growth in Korea
Similar Titles
Material Type Reports
Author(English)

Jong Il Kim

Publisher

[Seoul]:The Korean Economic Association

Date 2004
Subject Country South Korea(Asia and Pacific)
Language English
File Type Link
Subject Industry and Technology < IT
Industry and Technology < Science/Technology
Holding The Korean Economic Association

Abstract

This study analyzes the effect of IT investment on productivity growth based on Korean firm level data in 1996-2000. Empirical findings support the hypothesis that IT investment enhanced productivity by increasing value-added and saving ordinary capital and labor. Installed IT capital is estimated to be valued in the financial market much higher than the acquisition price. It implies that IT investment accompanies creation of unmeasurable intangible assets. Taking this into account, the contribution of IT investment to economic growth could be greater than suggested by conventional growth accounting. Strong structural reform after recent economic crisis might have helped IT investment to have a substantial impact on firm performance.