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The productivity payoff of information technology in multimarket SMEs

Abstract

This paper examines the effects of information technology (IT) adoption on the productivity of multimarket small and medium-sized enterprises (SMEs). The main hypothesis is that IT usage increases efficiency to a higher degree in diversified and internationalized firms compared with single-market SMEs. This hypothesis is tested using a large sample of more than 2,000 Spanish SMEs. Overall, intensive use of IT in operations processes is found to be associated with substantial increases in productivity of firms following both related and unrelated diversification. Also, exporting firms with more intensive use of IT have higher productivity. These results are consistent with previous theoretical arguments on the relationship between IT and efficiency of firms and open future research directions related to the role played by IT in the management control systems of both diversified and exporting firms.

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Notes

  1. The variable Efficiency lies in the interval [0, 1] and is left-skewed. By reflecting it (i.e., taking −Efficiency) we obtain a right-skewed variable which lies in [−1, 0]. We translate it to [1, 2] (taking 2 − Efficiency), and then the skewness is corrected with a logarithmic transformation [log(2 − Efficiency)]. Finally, the result is reflected again [−log(2 − Efficiency)] and translated to the interval [0, 1] [1 − log(2 − Efficiency)], so that the transformed efficiency lies in the original interval and with the right orientation.

  2. Results available from authors upon request.

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Correspondence to Francesco D. Sandulli.

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Sandulli, F.D., Fernández-Menéndez, J., Rodríguez-Duarte, A. et al. The productivity payoff of information technology in multimarket SMEs. Small Bus Econ 39, 99–117 (2012). https://doi.org/10.1007/s11187-010-9297-0

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  • DOI: https://doi.org/10.1007/s11187-010-9297-0

Keywords

  • Productivity paradox
  • Performance
  • Diversification
  • Internationalization
  • Small and medium-sized enterprises
  • Information technology

JEL Classifications

  • O30
  • M15
  • L25
  • L26