Digital transition in a turbulent world: European regional growth opportunities in 17 years’ time

Roberta Capello and Andrea Caragliu

Economics of Innovation and New Technology, 2025, vol. 34, issue 7, 997-1015

Abstract: Recently, the digital transition has been highlighted as a strategy fostering economic competitiveness. How the advantages from the digital transition will distribute over time and space is still unclear. This paper builds scenarios comparing the effects of a digital transition. Technological assumptions are consistently related to the assumptions on other structural changes. The internal coherence among assumptions is guaranteed by a larger overarching framework based on how the geopolitical context will evolve. A deeper within-EU integration and global cooperation, or a fragmented Europe torn in a world polarized in two blocs, enhance the digital transition and the main structural changes in different ways.Qualitative assumptions, validated through a Delphi analysis, are translated into quantitative ones and included in our MAcroeconometric, Social, Sectoral, Territorial 5 (MASST5) model, a regional macro-econometric forecasting model, through which simulations of GDP growth rates at regional (NUTS2) level are simulated for the period 2021–2038. Results show that if the digital investment plans stimulate growth, they only partially reverse regional growth divergence trends caused by advantages stemming from an integrated market, even if distributed with the aim of closing the digital gap among European countries.

Date: 2025
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DOI: 10.1080/10438599.2024.2393202

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