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Digitalization, industry 4.0 policies and inward foreign direct investments: evidence from European regions

In: Handbook of International Business Policy

Author

Listed:
  • Olimpija Hristova Zaevska
  • Diletta Pegoraro
  • Lucia Piscitello

Abstract

This chapter provides evidence on the relationship between digitalization policies and inward FDI (IFDI) in the European regions, specifically considering the amount of state aid related to the digitalization of firms and the presence of an I4 Ecosystem (I4ES) in the region, and relating them to the international openness of the region, in terms of IFDI attraction. EU regions’ level of innovativeness is classified according to the EU Regional Innovation Scoreboard (RIS 2021). The analysis shows that I4ES stimulate innovativeness, knowledge sharing and cross-fertilization in the region, thus supporting greater access to innovation state aid and the attraction of more IFDIs. Regions classified by the RIS 2021 as moderate or strong innovators host more I4ES as well as higher IFDI levels. In these regions, I4ES are internationally open, collaborating with firms internationally; this further facilitates FDI attraction, showing a virtuous circle between DIH, I4 and international openness of the region.

Suggested Citation

  • Olimpija Hristova Zaevska & Diletta Pegoraro & Lucia Piscitello, 2024. "Digitalization, industry 4.0 policies and inward foreign direct investments: evidence from European regions," Chapters, in: Philippe Gugler & Ana T. Tavares-Lehmann (ed.), Handbook of International Business Policy, chapter 20, pages 357-380, Edward Elgar Publishing.
    • Handle: RePEc:elg:eechap:22160_20
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    File URL: https://www.elgaronline.com/doi/10.4337/9781035308682.00029
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