Determinants of Digital Adoption in Business Across Countries: An Empirical Exploration on its Sustainability

Adoption of digital technology at different levels of economic activity is an important indicator of development. Countries are adopting digital technology at business and government levels to increase efficiency and accountability of service delivery to appropriate user groups. Many countries are using digital technology in banking, education, and many other sectors and recasting the relationship among customers, workers, and employers. The digital transformation progressively changes productivity across all sectors and industries. The empirical investigation shows that mainly the role of per capita income (state of living) and supply-side factors explain cross-country variations in Digital Adoption Index (DAI) in business using a static panel data model with fixed effect (FE) approach for 169 countries over the period 2014–2016. In this context, this study makes an attempt to understand the state of digital adoption in business across 169 countries in 2016 using World Bank data. The empirical results state that only major variable like labour force are positively and statistically significant with DAI across the countries. Although there are caveats that the International Monetary Fund has made about the digital economy, they state that we should think carefully about how to devise policies that will allow us to fully exploit the digital revolution’s benefits while minimizing job dislocation.