The Role of Digital Transformation in Enhancing Economic Productivity
Purpose: Digital transformation has become a key driver of global economic development, reshaping production processes, business models, and labor markets. This paper explores the relationship between digital transformation and economic productivity, focusing on how technological innovations such as artificial intelligence, automation, and big data analytics contribute to efficiency gains and competitiveness across sectors. Design/Methodology/Approach: The study adopts a comparative analytical approach based on recent empirical evidence from both developed and emerging economies. By reviewing existing literature and secondary data, the research identifies the main channels through which digital technologies enhance productivity, including innovation diffusion, reductions in transaction costs, improvements in resource allocation, and enhanced decision-making through data analytics. Findings: The findings suggest that countries investing in digital infrastructure, technological innovation, and human capital development experience higher productivity growth and greater economic resilience to external shocks. Moreover, the adoption of advanced digital technologies improves operational efficiency, fosters innovation, and strengthens firms’ competitive advantages in the global market. Practical Implications: The results highlight the importance for policymakers and business leaders to promote investments in digital infrastructure, digital skills development, and supportive regulatory frameworks. Encouraging technology adoption, strengthening innovative ecosystems, and reducing digital divides are essential to fully harness the productivity gains associated with digital transformation. Originality/Value: This paper contributes to the growing literature on the digital economy by synthesizing recent evidence on the productivity effects of digital technologies and by proposing policy recommendations aimed at fostering inclusive and sustainable digital transformation in the global economy.