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Austria’s digital transition: The diffusion challenge

Author

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  • Rauf Gönenç

    (OECD)

  • Béatrice Guérard

    (OECD)

Abstract

Austria’s transition to a digital economy and society is slower than in other high-income small open European economies. The rate and pace of utilisation of eight main ICT applications shows that Austrian firms follow peer country counterparts with a gap, which has widened in most areas in recent years. Two dynamics drive digital transitions and Austria has room for progress in both of them. First, the potential for digitalisation in all firms, and especially in the smaller ones (where gaps are largest) should be freed-up by upgrading the full range of ICT-generic, ICT-specific and ICT-complementary skills. Second, Austria needs to make its business environment more conducive to firm entry and exit. The rate of entry of new firms and their growth are crucial for the diffusion of new business models and ICT innovations but fall behind peer countries. The adoption of ICT innovations by households also follows a staggered path: young and highly educated Austrians adopt ICT applications in similar ways to their counterparts in peer countries, while middle and older age cohorts display noticeable gaps. This calls for policies to help lagging groups become more acquainted with innovations. A whole-of-government approach, including large-scale utilisation of e-government applications in enterprises and households, should help to embrace change and facilitate the flourishing of innovative businesses, work practices and lifestyles throughout Austria. This Working Paper relates to the 2017 OECD Economic Survey of Austria (www.oecd.org/eco/surveys/economic-survey-austria.htm)

Suggested Citation

  • Rauf Gönenç & Béatrice Guérard, 2017. "Austria’s digital transition: The diffusion challenge," OECD Economics Department Working Papers 1430, OECD Publishing.
  • Handle: RePEc:oec:ecoaaa:1430-en
    DOI: 10.1787/3b72b64e-en
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    More about this item

    Keywords

    diffusion of innovations; digitalisation; information technologies; technological innovation;
    All these keywords.

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
    • L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce
    • L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications
    • M15 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - IT Management
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy

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