The link between EU households' digitalization and growth factors. What does data (not) reveal?

Abstract

Households supply the workforce for the modern economy, increasingly based on information and communication technology (IT). The access of households to e-devices and e-channels has been continuously growing in the last two decades. The aim of the study is to reflect these theoretical concepts with data-based, econometric causality analysis. Specifically, this study investigates whether the digitalization of households is a factor in their macroeconomic and behavioural indicators. In other words, does households' access to digital devices and channels determine rates of employment, productivity (TFP), level of savings, disposable income, per capita GDP or the growth ratio of GDP, and even such institutional indicators as political stability? The methodology employed is panel Granger causality analysis and Dumitrescu-Hurlin test, and the regional scope is the EU. Causality is tested between the households' digitalization and their macroeconomic, consumer behaviour or institutional indicators using panel Granger causality tests.