Americans Do IT Better: US Multinationals and the Productivity Miracle
Abstract
US productivity growth accelerated after 1995 (unlike Europe's), particularly in sectors that intensively use information technologies (IT). Using two new micro panel datasets we show that US multinationals operating in Europe also experienced a “productivity miracle.” US multinationals obtained higher productivity from IT than non-US multinationals, particularly in the same sectors responsible for the US productivity acceleration. Furthermore, establishments taken over by US multinationals (but not by non-US multinationals) increased the productivity of their IT. Combining pan-European firm-level IT data with our management practices survey, we find that the US IT related productivity advantage is primarily due to its tougher “people management” practices. (JEL D24, E23, F23, M10, M16, O30)
Integrity signals
Registry
Cites
Statistics
Claims the paper makes
Claims other papers make about this one
Each is checked against this paper’s own text: does it say what the citing paper says it does?
The stable groups assumption is presumably satisfied for the Bloom et al. (2012) regression because between each pair of consecutive years it is likely that some firms have no change in the amount of IT capital per employee.
“The stable groups assumption is presumably satisfied: between each pair of consecutive years, it is likely that there are some firms where the amount of IT capital per employee ln( C/L ) does not change.”
From Two-Way Fixed Effects Estimators with Heterogeneous Treatment Effects (2020) · cites this paper as Bloom et al. (2012)
The Bloom et al. (2012) regression is a sharp design.
“This is a sharp design.”
From Two-Way Fixed Effects Estimators with Heterogeneous Treatment Effects (2020) · cites this paper as Bloom et al. (2012)
The Bloom et al. (2012) regression in Column 6 of Table 2 is similar to Regression 1 with some controls, except that it has three treatment variables.
“This regression is similar to Regression 1 with some controls, except that it has three treatment variables.”
From Two-Way Fixed Effects Estimators with Heterogeneous Treatment Effects (2020) · cites this paper as Bloom et al. (2012)
Cites
Initial conditions and moment restrictions in dynamic panel data models
Blundell, R., & Bond, S. (1998) · Journal of Econometrics · doi:10.1016/s0304-4076(98)00009-8 · Cited by 22,571 · see citing works
Export Versus FDI with Heterogeneous Firms
Helpman, E., Melitz, M. J., & Yeaple, S. R. (2004) · American Economic Review · doi:10.1257/000282804322970814 · Cited by 4,090 · see citing works
Measuring and Explaining Management Practices Across Firms and Countries
Bloom, N., & Van Reenen, J. (2007) · The Quarterly Journal of Economics · doi:10.1162/qjec.2007.122.4.1351 · Cited by 2,373 · see citing works
Self-citation
Flagged first, then by citations
Cited by
Sorted by citations
Two-Way Fixed Effects Estimators with Heterogeneous Treatment Effects
de Chaisemartin, C., & D’Haultfœuille, X. (2020) · American Economic Review · doi:10.1257/aer.20181169 · Cited by 5,031 · see citing works
Export Versus FDI with Heterogeneous Firms
Helpman, E., Melitz, M. J., & Yeaple, S. R. (2004) · American Economic Review · doi:10.1257/000282804322970814 · Cited by 4,090 · see citing works
Goldfarb, A., & Tucker, C. (2019) · Journal of Economic Literature · doi:10.1257/jel.20171452 · Cited by 2,744 · see citing works
Measuring and Explaining Management Practices Across Firms and Countries
Bloom, N., & Van Reenen, J. (2007) · The Quarterly Journal of Economics · doi:10.1162/qjec.2007.122.4.1351 · Cited by 2,373 · see citing works
Self-citationDo Recessions Accelerate Routine-Biased Technological Change? Evidence from Vacancy Postings
Hershbein, B., & Kahn, L. B. (2018) · American Economic Review · doi:10.1257/aer.20161570 · Cited by 573 · see citing works
What Drives Differences in Management Practices?
Bloom, N., Brynjolfsson, E., Foster, L., Jarmin, R., Patnaik, M., Saporta-Eksten, I., & Van Reenen, J. (2019) · American Economic Review · doi:10.1257/aer.20170491 · Cited by 502 · see citing works
Self-citationMachine learning and human capital complementarities: Experimental evidence on bias mitigation
Choudhury, P., Starr, E., & Agarwal, R. (2020) · Strategic Management Journal · doi:10.1002/smj.3152 · Cited by 293 · see citing works
Embodied carbon emissions in the supply chains of multinational enterprises
Zhang, Z., Guan, D., Wang, R., Meng, J., Zheng, H., Zhu, K., & Du, H. (2020) · Nature Climate Change · doi:10.1038/s41558-020-0895-9 · Cited by 235 · see citing works
Information Technology Impacts on Firm Performance: An Extension of Kohli and 1
Sabherwal, R., & Jeyaraj, A. (2015) · MIS Quarterly · doi:10.25300/misq/2015/39.4.4 · Cited by 200 · see citing works
Measuring digitization: A growth and welfare multiplier
Katz, R. L., & Koutroumpis, P. (2013) · Technovation · doi:10.1016/j.technovation.2013.06.004 · Cited by 138 · see citing works
Huang, P., Tafti, A., & Mithas, S. (2018) · MIS Quarterly · doi:10.25300/misq/2018/13490 · Cited by 133 · see citing works
- Authors
- Bloom, N., Sadun, R., & Reenen, J. V.
- Affiliations
- National Bureau of Economic Research (US)
- London School of Economics, Centre for Economic Performance, Houghton Street, London WC2A 2AE, UK, CEPR, and NBER.
- Venue
- American Economic Review
- Publisher
- American Economic Association
- Published
- 2012-02-01
- Volume
- 102
- Issue
- 1
- Pages
- 167-201
- ISSN
- 0002-8282 (ISSN-L)
- OpenAlex
- W2150611598
- Cited by
- 1,028
- References
- 3
- Citations by year
- 2026: 104 · 2025: 71 · 2024: 75 · 2023: 96 · 2022: 74 · 2021: 67 · 2020: 78 · 2019: 50 · 2018: 69 · 2017: 72 · 2016: 58 · 2015: 47 · 2014: 37 · 2013: 46 · 2012: 30
- FWCI
- 122.43
- Type
- journal article
- Language
- en
- Open access
- closed
- Locations
- American Economic Review (publishedVersion)
- RePEc: Research Papers in Economics (submittedVersion)
- Funders
- Economic and Social Research Council (ES/H02123X/1)
- Topics
- Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Economic Growth and Productivity
- Social Sciences › Economics, Econometrics and Finance › General Economics, Econometrics and Finance › Global trade and economics
- Social Sciences › Business, Management and Accounting › Strategy and Management › International Business and FDI
- Keywords
- productivity growth, US multinationals, information technology, multinational acquisitions, cross-border mergers, management practices, personnel management, firm productivity
About these checks
Registry, retraction, Cites and statistics results are computed, not judged, with one exception: a printed reference that no index lists is read once by a model before it counts as a citation error. Claims are extracted by a model and kept only when their quote appears verbatim in the text; each cited source is then checked, with a model’s help, for whether it says what the claim relies on. Those verdicts can be wrong — read the claim’s quote and the cited source before relying on one.
Statistics and arithmetic are recomputed, not judged.
Confidence bands are shown only for fields calibrated on our annotated test set. None is calibrated yet, so no band is shown.
What counts as a claim ›How we measure confidence ›How we check this ›
Are you an author, or do you see a problem with this page? Request a review
