The Effects of Digitalization on Economic Growth: A Comparative Panel Data Analysis of EU and BRICS-T Countries

This study examines the influence of digitalization on economic growth through a comparative comparison of European Union (EU) countries and BRICS-T nations. The study employs panel data analysis, encompassing the years 2001 to 2022 for EU countries and 2003 to 2021 for BRICS-T countries. The findings indicate that in EU nations, variables such as internet utilization, fixed broadband availability, and gross fixed capital formation positively and considerably enhance economic growth. In BRICS-T nations, mobile phone subscriptions, internet utilization, and gross fixed capital formation are pivotal growth catalysts. Nonetheless, foreign direct investments and trade openness exhibit statistically minor effects in both regions. This research underscores the essential function of digital infrastructure in promoting economic development and offers policy recommendations to optimize the advantages of digitalization in both emerging and mature nations.