Nexus of Total Factor Productivity, IT & Skills: A Literature Review

The contribution of the information and technology (IT) to Indian economy is well acknowledged. In this context, this study carries out a comprehensive literature review to find the linkages among IT, skills and productivity. Results indicate that majority of the studies support the hypothesis that IT promotes productivity and skills play the role of an enabler. The study also reveals three preconditions to accept the nexus. First, it takes time to establish the IT infrastructure and skill building and therefore time lag plays an important part. Second, it is important to have skilled workforce and people practices to reap the benefit of IT and turn them into higher productivity. Third and finally, the maturity of IT adoption is precursor for IT implementation and skill building.