This paper examines the impact of information technology (IT) on laborproductivity growth using industry-level data for five OECD countries (theUnited States, Canada, Japan, France, and the United Kingdom), from 1970to 1990. Empirical findings show that IT investment has a positive effect onlabor productivity growth, accounting for about 15 percent of this growth.The benefit of IT investment was on average lower than its cost over the1970-1990 period, which implies that new IT investment had not beenefficiently used in the early period of IT adoption. The benefit per dollar costwas almost two times greater in the 1980s than in the 1970s, which is mainlydue to a rapid fall in IT prices