The growing digital divide in Europe and the United States

Désirée Rückert, Reinhilde Veugelers and Christoph Weiss

No 2020/07, EIB Working Papers from European Investment Bank (EIB)

Abstract: Using a new survey on digitalisation activities of firms in the EU and the US, we identify digitalisation profiles based on the current use of digital technologies and future investment plans in digitalisation. Our analysis confirms the trend toward digital polarisation and a growing digital divide in the corporate landscape with, on one side, many firms that are not digitally active, and on the other side, a substantial number of digitally active firms forging ahead. Old small firms, with less than 50 employees and more than 10 years old, are significantly more likely to be persistently digitally non-active. We show that these persistently non-digital firms are less likely to be innovative, increase employment or command higher mark-ups. These trends are likely to exacerbate the digital divide across firms in the EU and the US.

Keywords: digital technology; investment; firm performance (search for similar items in EconPapers)
JEL-codes: D22 E22 L25 (search for similar items in EconPapers)
Date: 2020
New Economics Papers: this item is included in nep-bec, nep-ent, nep-eur, nep-gen, nep-ict, nep-knm, nep-mac, nep-sbm and nep-tid
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Working Paper: The growing digital divide in Europe and the United States (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:eibwps:202007

DOI: 10.2867/222528

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