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Digitalization and resilience

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  • Copestake, Alexander
  • Estefania-Flores, Julia
  • Furceri, Davide

Abstract

This paper investigates the role of digitalization in improving economic resilience. Using balance sheet data from 24,000 firms in 75 countries, and a difference-in-differences approach, we find that firms in industries that are more digitalized experience lower revenue losses following recessions. Early data since the outbreak of the COVID-19 pandemic suggest an even larger effect during the resulting recessions. These results are robust across a wide range of digitalization measures—such as ICT input and employment shares, robot usage, online sales, intangible assets and digital skills listed on online profiles—and several alternative specifications.

Suggested Citation

  • Copestake, Alexander & Estefania-Flores, Julia & Furceri, Davide, 2024. "Digitalization and resilience," Research Policy, Elsevier, vol. 53(3).
    • Handle: RePEc:eee:respol:v:53:y:2024:i:3:s0048733323002329
    DOI: 10.1016/j.respol.2023.104948
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    Cited by:

    1. Oughton, Edward J. & Amaglobeli, David & Moszoro, Marian, 2023. "What would it cost to connect the unconnected? Estimating global universal broadband infrastructure investment," Telecommunications Policy, Elsevier, vol. 47(10).
    2. Chiara Franco & Filomena Pietrovito, 2024. "Drivers of firms’ digital activities in response to the Covid-19 pandemic," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 14(3), pages 695-726, September.
    3. Franco, Chiara & Pietrovito, Filomena, 2024. "Drivers of firms' digital activities in response to the Covid-19 pandemic," Economics & Statistics Discussion Papers esdp24096, University of Molise, Department of Economics.

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    More about this item

    Keywords

    Resilience; Digitalization; Recessions; Firms; Local projection;
    All these keywords.

    JEL classification:

    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • G39 - Financial Economics - - Corporate Finance and Governance - - - Other
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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