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Innovation policies and firms’ productivity: the Italian Industry 4.0 Plan for digital transformation

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Elena Cefis at University of Bergamo
Elena Cefis
Stefania Scrofani at Sant'Anna School of Advanced Studies
Stefania Scrofani
Matteo Tubiana at Polytechnic University of Turin
Matteo Tubiana
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Abstract and Figures

Industry 4.0 technologies radically change industrial processes. National governments have enacted innovation policies to support firms’ investments in new technologies and increase productivity growth. The Italian Industry 4.0 Plan (II4.0 Plan) was implemented with this purpose in 2017 and consisted of a horizontal fiscal plan. Using a new methodology that relies on firms’ financial accounts rather than survey data, we identify firms that benefited from the II4.0 Plan’s incentives and extend the analysis to the population of Italian firms. The results from a Difference-in-Differences regression approach show that the investments spurred by the II4.0 Plan positively affect firms’ labour productivity but heterogeneously among size classes, sectors and type of incentive. Hyper and super amortization and the credit for innovation drive the results. We frame our policy evaluation into the most recent discussion about innovation policies, raising some criticisms on the appropriateness of horizontal policies to foster digital transformation.
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Vol.:(0123456789)
The Journal of Technology Transfer
https://doi.org/10.1007/s10961-024-10179-2
Innovation policies andfirms’ productivity: theItalian
Industry 4.0 Plan fordigital transformation
ElenaCes1,2 · StefaniaScrofani2 · MatteoTubiana3
Accepted: 6 December 2024
© The Author(s), under exclusive licence to Springer Science+Business Media, LLC, part of Springer Nature 2025
Abstract
Industry 4.0 technologies radically change industrial processes. National governments have
enacted innovation policies to support firms’ investments in new technologies and increase
productivity growth. The Italian Industry 4.0 Plan (II4.0 Plan) was implemented with this
purpose in 2017 and consisted of a horizontal fiscal plan. Using a new methodology that
relies on firms’ financial accounts rather than survey data, we identify firms that benefited
from the II4.0 Plan’s incentives and extend the analysis to the population of Italian firms.
The results from a Difference-in-Differences regression approach show that the invest-
ments spurred by the II4.0 Plan positively affect firms’ labour productivity but heterogene-
ously among size classes, sectors and type of incentive. Hyper and super amortization and
the credit for innovation drive the results. We frame our policy evaluation into the most
recent discussion about innovation policies, raising some criticisms on the appropriateness
of horizontal policies to foster digital transformation.
Keywords Innovation policies· Industry 4.0· Digital transformation· Labour
productivity· Financial statement analysis
JEL Classification O38· O39
1 Introduction
Economies and societies change, adapt and develop through innovations. Innovation
derives from the interaction of different actors and organisations, and how innovations
shape and impact the economy and society depends on the technologies involved (Fager-
berg etal., 2006). Currently, societies are experiencing the impact of digital technologies
enabling the fourth industrial revolution. Industry 4.0 is based on nine technological pil-
lars: Internet of Things (IoT), Cyber-Physical Systems (CPS), Big Data and Analytics,
* Matteo Tubiana
matteo.tubiana@polito.it
1 University ofBergamo, Bergamo, Italy
2 Sant’Anna School ofAdvanced Studies, Pisa, Italy
3 Polytechnic ofTorino, Torino, Italy
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