IMPACT OF ICT CAPITAL SERVICES ON PRODUCTIVITY GROWTH ACROSS CENTRAL AND EASTERN EUROPEAN COUNTIRES - WHERE HAVE ALL DIGITAL BENEFITS GONE?

The paper aims to examine the contribution of ICT capital services on productivity growth in the Central and Eastern European (CEE) countries relatively to the old EU member states (EU10: Austria, Belgium, Denmark, Finland, France, Germany, Italy, the Netherlands, Spain, and the United Kingdom). Statistical analysis based on the EU KLEMS database clearly demonstrates that while in the EU10 ICT capital services bring the largest contribution to the labour productivity, in CEE economies non-ICT services contribute productivity growth. However, regression results of quasi-Maximum Likelihood (QML) estimator indicate that in CEE economies positive effects of ICT capital services could be hidden in the TFP contribution.