Big for Everyone? Big Data, Firm Size and Performance

Abstract

Big data (BD) analytics is considered one of the most important general-purpose technologies of our era. Given the pervasiveness of BD across industries, both policy-makers and scholars have become particularly interested in assessing the effects of BD on firm performance. However, previous studies have not investigated whether the performance benefits of BD accrue homogeneously to all firms or, instead, as some scholars warn, mainly to large companies. To address this question, we explore the effect of BD in two large and representative samples of firms. Our findings indicate that both large and small firms can gain from BD, yet large firms predominantly use BD to enhance efficiency via process innovation, whereas small firms use BD to increase sales through product innovation.