A Governance Model for Increasing the Positive Effects of Institutions on the Long Run Economic Growth

Abstract

The main aim of this study is to critically analyze the effects of institutions on economic growth on the basis of a deeply literature review with a technological point of view. This study found that culture, traditions, tacit knowledge, openness to innovations are the outstanding points in new century and we assert that for increasing positive effects of institutions in the long term there should be a model for management and governance of business of institutions that is the whole economy in the digital macroeconomics. In the era of the upcoming industry 4.0, smart cities and e-government paradigms there should be integration of IT and business processes via a valid management and governance model. With the assumption that innovation digestion and cutting-edge IT capability of institutions have positive effect on their profitability and competency in the market, COBIT model is found to be a valid and sustainable framework for effective and efficient institutional set-ups that provide a sustainable platform for economic value creation cycle.