ICT infrastructure in firms and online sales

Abstract This study investigates whether the underlying information and communication technology (ICT) infrastructure of firms affects development online sales, based on a novel micro-aggregated panel dataset encompassing large group European countries. The includes continuous measures sales activities, as well standard production function input variables. Dynamic System GMM estimations show positive significant associations between proportion selling ICT infrastructure, measured broadband internet connected employees. magnitude effect is stronger in manufacturing than service firms, but both industries, there threshold beyond which effects diminish. In addition, evidence that improvements lead to medium-sized rather small firms.