Exploring the Link between Icts Utilisation and Labour Productivity across the European Union

Abstract

Purpose | This study aims to determine the effect of ICTs utilisation on labour produc tivity. It compares how different aspects of the digital economy affect productivity in two groups of countries within the European Union – the developed (“the Old Europe”) and the developing (“the New Europe”). Research method | In this study, random forest regression was used on two groups of countries within the European Union. Results | The utilisation of ICTs between the two parts of the European Union is sig nificantly different. Two independent random forests show that the most influential variables in “the Old Europe” are the least influential in “the New Europe,” and vice versa. This showcases that the theory of the national ecosystem is correct. There is no universal way in which ICT adaptation influences productivity. Originality / value / implications / recommendations | This study reveals differences within the interconnected economy of the European Union. It shows that even in the case of widespread and accessible technologies, there are meaningful differences in their adaptation based on national ecosystems and regional factors. The findings should serve as a basis for future research on the institutional and regional factors influencing differences in ICT adaptation and utilisation.