--- canonical_url: "https://csls.ca/ipm-archive/ipm-issue-31/the-productivity-paradox-of-the-new-digital-economy/" title: "The Productivity Paradox of the New Digital Economy" author: name: "CSLS" url: "https://csls.ca/author/cslc/" date_published: "2026-07-13T07:40:53+00:00" date_modified: "2026-07-13T07:40:53+00:00" post_type: "ipm" summary: "" ipm_issue_period: - "Fall 2016" ipm_keyword: - "deployment phase" - "digital economy" - "Germany" - "ICT" - "installation phase" - "productivity paradox" - "United Kingdom" - "United States" - "van Ark" ipm_research_theme: - "Technology and innovation" ipm_country_focus: - "Germany" - "International" - "United Kingdom" - "United States" featured_image: "https://csls.ca/wp-content/uploads/2026/06/IPM_50_banner.webp" status: "publish" --- # The Productivity Paradox of the New Digital Economy Canonical URL: https://csls.ca/ipm-archive/ipm-issue-31/the-productivity-paradox-of-the-new-digital-economy/ # The Productivity Paradox of the New Digital Economy [Download full PDF article](https://csls.ca/wp-content/uploads/2026/07/IPM-Issue-31-1-van-Ark.pdf) Cite this article × Cite this article as: van Ark, Bart. 2016. “The Productivity Paradox of the New Digital Economy.” International Productivity Monitor, No. 31 (Fall 2016): 3–18. https://www.csls.ca/ipm-archive/ipm-issue-31/the-productivity-paradox-of-the-new-digital-economy/ ## Author: - Bart van Ark University of Manchester / The Productivity Institute ## IPM Issue 31 Fall 2016 pp. 3–18 ## Related IPM articles [The Challenges of Productivity Measurement — Review Article on The Measure of Economies: Measuring Productivity in an Age of Technological Change Chad Syverson Spring 2025 | IPM Issue 48 | pp. 139–143](https://csls.ca/ipm-archive/ipm-issue-48/the-challenges-of-productivity-measurement-review-article-on-the-measure-of-economies-measuring-productivity-in-an-age-of-technological-change/) [De-industrialization and the Great Productivity Slowdown: What Comes Next? 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Bart van Ark, Klaas de Vries, Abdul Erumban Spring 2024 | IPM Issue 46 | pp. 38–59](https://csls.ca/ipm-archive/ipm-issue-46/are-intangibles-running-out-of-steam/) [Cracking the Productivity Code: An International Comparison of UK Productivity John Van Reenen, Xuyi Yang Spring 2024 | IPM Issue 46 | pp. 60–82](https://csls.ca/ipm-archive/ipm-issue-46/cracking-the-productivity-code-an-international-comparison-of-uk-productivity/) [Intangible Capital, TFP Growth and Green Shoots in New Productivity Data Filippo Bontadini, Carol Corrado, Jonathan Haskel, Massimiliano Iommi, Cecilia Jona-Lasinio, Tsutomu Miyagawa Spring 2024 | IPM Issue 46 | pp. 3–37](https://csls.ca/ipm-archive/ipm-issue-46/intangible-capital-tfp-growth-and-green-shoots-in-new-productivity-data/) [Capacity Utilization and Production Function Estimation: Implications for Productivity Analysis Jianmin Tang, Weimin Wang Fall 2023 | IPM Issue 45 | pp. 178–199](https://csls.ca/ipm-archive/ipm-issue-45/capacity-utilization-and-production-function-estimation-implications-for-productivity-analysis/) [Recent Productivity Trends in Canada: Navigating the Twin Transitions of Green and Digitalization Jonathan Barr, Peter Foltin, Jianmin Tang Fall 2023 | IPM Issue 45 | pp. 93–119](https://csls.ca/ipm-archive/ipm-issue-45/recent-productivity-trends-in-canada-navigating-the-twin-transitions-of-green-and-digitalization/) [The Post-2001 Productivity Growth Divergence between Canada and the United States Wulong Gu, Michael Willox Fall 2023 | IPM Issue 45 | pp. 28–60](https://csls.ca/ipm-archive/ipm-issue-45/the-post-2001-productivity-growth-divergence-between-canada-and-the-united-states/) [Lessons from a Career in Productivity Research: Some Answers, A Glimpse of the Future, and Much Left to Learn Martin Baily Spring 2023 | IPM Issue 44 | pp. 120–149](https://csls.ca/ipm-archive/ipm-issue-44/lessons-from-a-career-in-productivity-research-some-answers-a-glimpse-of-the-future-and-much-left-to-learn/) [The Rise of Pro-Productivity Institutions: A Review of Recent Developments Dirk Pilat Spring 2023 | IPM Issue 44 | pp. 3–33](https://csls.ca/ipm-archive/ipm-issue-44/the-rise-of-pro-productivity-institutions-a-review-of-recent-developments/) ## Abstract ## Résumé EN FR Copy link Email LinkedIn Despite a rapid increase in business spending on capital and services in Information and Communication Technology (ICT), the New Digital Economy (mobile technology, the internet, and cloud) has not yet generated any visible improvement in productivity growth. This article reviews the latest evidence for the United States, the United Kingdom and Germany. We find rapidly declining ICT prices, a shift from ICT investment to ICT services, and a continued increase in knowledge based-assets supporting ICT. However, the New Digital Economy is still in its “installation phase” and productivity effects may occur only once the technology enters the “deployment phase”. The ri se of th e New Dig ital Economy, Malgré une hausse rapide des dépenses des entreprises en capital et en services de technologies de l’information et des communications (TIC), la nouvelle économie numérique (technologie mobile, Internet et informatique en nuage) n’a pas encore généré d’amélioration visible de la croissance de la productivité. Cet article passe en revue les données probantes les plus récentes pour les États-Unis, le Royaume-Uni et l’Allemagne. Nous observons une baisse rapide des prix des TIC, un passage de l’investissement en TIC aux services TIC et une hausse continue des actifs fondés sur le savoir soutenant les TIC. Cependant, la nouvelle économie numérique est encore dans sa « phase d’installation » et les effets sur la productivité pourraient ne se manifester qu’une fois que la technologie entre dans la « phase de déploiement ». [Download full PDF](https://csls.ca/wp-content/uploads/2026/07/IPM-Issue-31-1-van-Ark.pdf)