Overcoming barriers to manufacturing digitalization: Policies across EU countries

Abstract

The digital transformation of manufacturing activities is expected to bring large societal benefits in terms of productivity and sustainability. However, uptake of digital technologies is slower than desirable. As a result, governments are taking action to try to overcome some of the barriers to adoption. However, the mechanisms through which government may act are quite diverse. In this paper, we compare the national strategies across the 27 countries members of the European Union. We map each country's initiative to 14 barriers to the adoption of digital technologies in manufacturing observed in the literature. We observe that most institutional efforts focus on providing funding, developing new regulatory frameworks related to data privacy and security, and creating human capital. Some known barriers to adoption observed at the firm level, such as the lack of off-the-shelf solutions, or the need for retrofitting old equipment, are largely overlooked. We do not find any relationship between the number of initiatives proposed by each country, and the country's existing level of digitalization. We conclude by proposing several policy recommendations, as well as directions for future research.