1995 Volume 4 Issue 2 Pages 71-84
In this paper we report results of an empirical assessment of the productivity of information systems in Japanese manufacturing industries. A production function is estimated on the basis of the datasets published from MITI and the Bank of Japan.
Our results indicate that information technology capital has made a substantial contribution to output. We find that between 1985 and 1991, return on investment (ROI) for computer capital averaged 4%. This value is far greater than ROI for other types of capital (4%). We find also that increases in information systems labor and expense have only a small impact on total sales.
