Network economies and growth

  • Gennaro Zezza
  • Published 2001


Recent developments in economic growth theory have focused on increasing returns as a source of self-accelerating growth in countries or regions. Several empirical contributions have investigated wether increasing returns can imply divergence in growth rates, or per-capita income levels, across regions, against the hypothesis of convergence implied by more orthodox growth models. In this paper we wish to contribute to this debate by analyzing the role for those network externalities associated to the fast-growing share of industries which use the Internet or other information networks as a mean of production. The evidence on the impact of new information technologies on growth is still mixed: several authors point out that investment in Information and Communication Technologies (ICTs) have significant effects on productivity, thus accelerating growth, while others note that faster growth can better be explained by less stringent monetary and fiscal policy, with investment in ICT being a consequence of growth rather than its cause. Some references: Bassanini, A. Scarpetta, S. Visco, I. (2000), "Knowledge, technology and economic growth: recent evidence from OECD countries", Economics Department Working paper n.259, Paris, OECD, October. Brynjolfsson, E. – Yang, S. (1996), “Information Technology and Productivity: A Review of the Literature”, Advances in Computers, Academic Press, Vol. 43, P. 179-214 Daveri, F. (2000), "Is growth an information technology story in Europe too?", IGIER Working Paper No. 168, September. Gordon, R.J. (2000), "Does the New Economy Measure Up to the Great Inventions of the Past?", Journal of Economic Perspectives, vol. 4, n.14, Fall. Jorgenson, D.W. Stiroh, K.J. (2000), "Raising the Speed Limit: U.S. Economic Growth in the Information Age", Brookings Papers on Economic Activity. Zezza, G. (2001), “Growth in the Net economy: the role for e-government”, presentato al Third Global Forum "Fostering democracy and development through e-government", Napoli, 15-17 march.

Cite this paper

@inproceedings{Zezza2001NetworkEA, title={Network economies and growth}, author={Gennaro Zezza}, year={2001} }