Digital and economic transformations for sustainable development promotion: A case of OECD countries

Abstract

Digitalization, dematerialization of production and consumption, and structural shifts in the direction of service economy forming do promote to reduction of material use and sustainable development. The paper aims to investigate the role of digital, structural, economic, and social factors in sustainable development promotion in OECD countries. The paper uses the data on digital achievements, social and economic development of OECD member states from World Bank data sources for the period 2007–2018. The randomeffects GLS regression model is used, and empirical regression models to estimate the influence of key factors related to digital transformation on GDP per capita and CO2 emissions per capita are constructed. The results of the regression analysis show that using the number of Internet users as an indicator for achievement in digitalization has a positive and statistically significant influence on GDP per capita due to lower transaction costs and higher share service economy. An increase in urbanization rates (as an indicator of capital concentrations and labor specialization) by one percent promotes a GDP per capita increase of 299 USD. Also, an increase in Gini coefficient by one percentage point correlates with decrease in GDP per capita on 196 USD and the reduction of CO2 per capita by 0.12 tones due to the structural shifts in aggregate demand. Still, improvements in digital transformations have no significant environmental effect in OECD members, while processes related to urbanization, income inequality