The Computerization of Service: Evidence of Information and Communication Technologies in Real Estate

Abstract

We explore the overlap between service and computerization using macro-level industrial data on the U.S. real estate market and five comparison industries (hospitals, financial services, legal services, machinery manufacturing, and fabricated metals). The macro-level data comes from the U.S. Bureau of Economic Analysis and the U.S. Census Bureau and we use it to develop insights on computerization and service relative to contributions to the U.S. gross domestic product. This analysis shows that while information and communication technology investments in real estate lagged comparison industries from 1969 to 1997, since then ICT investments in real estate have increased rapidly. At the same time, there has been a growth in the number workers even as the industry’s contribution to GDP has grown. We identify two implications of these findings. First, ICTs are not being used are not as a substitute for labor. Second, the rapid growth in ICT investments has been absorbed into real estate quickly and well. Still, computerization in real estate continues, suggesting that process studies and more micro-analyses are critical next steps.