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Digitalization as a driver of economic growth: Does only infrastructure matters?

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  • Ponomareva, E.

    (Institute of Control and Supervision, Russian Presidential Academy of National Economy and Public Administration, Moscow, Russia)

Abstract

The development of digital technologies leads to significant changes in all sectors of the economy. However, digital transformation is a complex process, depending on various factors, such as the availability of digital infrastructure, the level of readiness of digital technologies, the availability of qualified personnel who are able not only to collect data, but also to identify dependencies in them and use these results to increase productivity and scale different types of activities. During the coronavirus pandemic, the relevance of the introduction of digital technologies increases due to the need for social distancing, including the exclusion of a person from certain stages of production, as well as the need to coordinate a large number of people and devices not related to workplace. This article considers the impact of digital technology development on macroeconomic parameters, in particular, economic output by analyzing the system of simultaneous equations that takes into account not only the production function of the economy, but also the equilibrium in the ICT services sector on the data of Russian regions. The obtained results show that along with the possibility to use broadband access to the Internet, the quality of its use also matters: 1% growth in the number of broadband access subscribers on average leads to a 0,1% increase in output, in addition, an increase in the intensity of digital technology use on 1% leads to an additional 0,05% increase in output.

Suggested Citation

  • Ponomareva, E., 2021. "Digitalization as a driver of economic growth: Does only infrastructure matters?," Journal of the New Economic Association, New Economic Association, vol. 51(3), pages 51-68.
    • Handle: RePEc:nea:journl:y:2021:i:51:p:51-68
    DOI: 10.31737/2221-2264-2021-51-3-3
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    References listed on IDEAS

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    Cited by:

    1. Marti, Luisa & Puertas, Rosa, 2023. "Analysis of European competitiveness based on its innovative capacity and digitalization level," Technology in Society, Elsevier, vol. 72(C).

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    More about this item

    Keywords

    digital economy; economic growth; new technologies; ICT sector; online platforms;
    All these keywords.

    JEL classification:

    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • R58 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Regional Development Planning and Policy

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