Abstract

The main purpose of this study is to analyze the impact of R&D capital and IT labor (i.e., H-1B workforce) to a firm’s productivity and measure their interaction effect after controlling other firm-specific effects. In this study, we will use panel data to overcome specific limitations of prior studies on IT productivity including endogeneity bias (i.e., omitted data) and sample composition issues (i.e., firm size). Our study will give some inference that IT and R&D investments need to be coordinated for increasing the business value of a firm.

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