Digital Readiness and Economic Growth: Analyzing the Impact of DESI Scores on GDP in European Countries

Abstract

This study investigates the impact of the Digital Economy and Society Index (DESI) on Gross Domestic Product (GDP) across European countries, incorporating control variables such as Industrial Production, Employment, Inflation, and Investment. The research employs panel regression analysis of data from 22 European nations from 2017 to 2022, focusing on DESI components like Human Capital, Connectivity, Integration of Digital Technology, and Digital Public Services. The study's findings reveal significant correlations, with specific emphasis on the positive influence of Human Capital and Integration of Digital Technology on GDP, while showing an unexpected negative correlation with Digital Public Services. This research contributes to the understanding of the complex relationship between digital readiness and economic performance, offering valuable insights for policy development and economic planning in the era of digital transformation.