Digital Transformation and Its Influence on GDP

Abstract

Summary Digital transformation as integration of digital technology into business results in fundamental changes of way world does business, communicate and develops on national and international level. There is increase of high-tech public spending which is connected with increase of need for high-tech as well as importance and benefits that it brings to development of economy. This so called digital or high-tech sector is one of the strategic sectors in the leading world economies, starting from the US and the European Union. EU recognized it in strategic document “Europe 2020” which sees this sector as key factor in smart growth based on tech knowledge and innovation. Europe, especially western and northern Europe, is trying to keep its competitiveness in global tech arena with USA and fast developing countries such as China and India as well as Asian tech giants such are Japan, South Korea and Singapore. There is increase of European countries investment in digital transformation through private and public ICT sector development which usually has positive impact on economic growth as well as key indicators such are GDP, productivity and employment. This paper provides basic review of digital transformation and high-tech sector in Europe as well as comparison between EU and Western Balkan countries. Additionally, there is analysis of influence of ICT spending on GDP growth. Paper could serve as basic for further research in area of influence of tech investment on key macroeconomics indicators.

Traditional and New ICT Spending and Its Impact on Economy

“…In this regard, studies mainly investigate the impact that ICT has on GDP growth, and the results show a positive relationship between the two (e.g., ref. 28 ) Additionally, the study based on the data for European countries 29 shows that countries, which invest more into ICT, also have higher GDP per capita. Consequently, it is proposed 29 that economies should continue to increase investments and spending on ICT, but also ensure the timely upgrade and/or modernization of ICT in order to achieve growth in macroeconomic indicators, including productivity and GDP.…”

“…17 Although there exists a huge range of studies focusing on the role of ICT regarding economic growth (e.g., refs. [18][19][20][21][22][23][24][25][26][27][28][29] there is a lack of studies which would offer a detailed insight into the development process within ICT-related changes and diffusion process. More specifically, studies often measure the ICT diffusion using the data on the ICT use and focus on the specific type of ICT.…”

“…Namely, we argue that also higher GDP accelerates ICT spending (as claimed also by ref. 29 ) Consequently, our study identifies different relations between new/traditional/total ICT spending and labor productivity/GDP, where also data analysis considering time lags was used, to provide insight into the correlation between ICT spending and economic indicators, where time dimension is taken into account.…”

Cluster Analysis of IT Security Risks in Chosen Sectors

“…There is a high level of consensus regarding the fact that digital transformation has already begun and is proceeding to gain momentum as we can see from the works from Spremić (2017b), Shaughnessy (2018) and Mićić (2017). It can be stated that the digital environment is usually unknown to the companies that are trying to digitalise their business and that they are unprepared for these new technologies especially for information security (Simpson, 2016;Spremić, 2017a;Zerzan, 2009).…”

How Agile Development and Its Tools Support Digital Transformation

“…However, Mićić attempted to define digital transformation as an "Integration of digital technology into a business that results in, sometimes fundamental, changes in business operation and delivery of value to customers.". [1] Digital transformation is an innovation in the process that companies follow in their business, it aids in reducing dull work and investing the time for planning the Therefore, digital transformation speeds up the daily work in a way that exploits vast technology to serve customers faster and better with fewer errors and more efficient work. It also increases workflow and number of members of your team without having the necessity to hire more.…”