IT Investment and Firm Performance in U.S. Retail Trade


Mark Doms

Ron S. Jarmin

Shawn D. Klimek

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2003-19 | November 1, 2003

We examine the relationship between investments in information technology (IT) and two measures of retail firm performance: labor productivity and productivity growth over the 1992 to 1997 period. We use untapped firm and establishment micro data from the Censuses of Retail Trade and the Assets and Expenditures Survey. We show that large firms account for most retail IT investment, employment and establishment growth. We find evidence of a significant relationship between IT investment intensity and productivity growth. We found no evidence of a similar link between IT and growth in the number of establishments operated by retail firms.

Article Citation

Doms, Mark, Ron S. Jarmin, and Shawn D. Klimek. 2003. “IT Investment and Firm Performance in U.S. Retail Trade,” Federal Reserve Bank of San Francisco Working Paper 2003-19. Available at