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Field: Strukturomvandling

Productivity divergence and the role of digitalisation

Productivity development in general has been extensively studied. Behind the aggregates, there are a variety of firms which potentially show substantial productivity differences. The productivity distribution is, to a large extent, unexploited in a Swedish context. This paper investigates productivity development in different parts of the productivity distribution, dynamics between the productivity groups, and whether differences can be observed depending on the digital intensity and the intangible asset intensity of the sector. We find increases in productivity differences over time, with greater increases in digital-intensive sectors and sectors characterised by a large share of intangible assets. Similarly, the catch-up effect is found to decline over time, driven by these sectors. Additionally, there are large dynamics between groups, so the least productive firms do not remain low-productive for a long time. From a policy perspective, it is important to promote the spread of new technologies and knowledge, where education level of the employees in general is important, especially concerning digital competence. Moreover, labourmarket mobility and different collaboration activities (e.g., between firms or universities) can also be positive for spreading technologies.


Productivity divergence and the role of digitalisation

Serial number: Report 2022:08

Reference number: 2020/35

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