Comparison of international digitalisation indexes: A quantitative analysis perspective

Abstract

Objective: The objective of the article is to compare the available digitalisation indexes in the EU (European Union) and Pacific Asia. The first step to tackling the between-country digital gap is to measure digital development. However, the available indexes differ substantially in terms of construction, metric used, and the areas they cover.

Research Design & Methods: The first part of the study is a descriptive analysis of the scope and metrics used by three digitalisation indexes: digital economy and society index (DESI), ASEAN digital integration index (ADII) and digital intelligence index (DII). In the second part, we approach the problem from a quantitative perspective, using correlation coefficients and comparing countries’ rankings obtained using different indexes. Lastly, we performed clustering analysis with the use of an agglomerative algorithm with Euclidean distances and the Ward method. The data covers 13 countries from the Pacific Asia and 24 from the EU.

Findings: We found that the specifications of indexes differ considerably, not only in the choice of particular metrics but in whole digitalisation areas. Some indexes include overall economic or social development measures that are not strictly related to the digital sphere. Despite that, for countries covered by two indexes, we found high correlations of scores: 0.932 between ADII and DII, and 0.883 between DII and DESI. Comparing rankings and using clustering analysis, we found that the indexes for Pacific Asia are more similar than for the EU, possibly because Asian countries are more heterogeneous both in digital and economic development.

Implications & Recommendations: Any study of the digital divide and its causes is affected by the choice of digitalisation measure. We found that DII and ADII indexes include some socio-economic metrics that may interfere with the results in the studies of the links between economic and digital development. Although the indexes’ scores are quite highly correlated, in some cases, they can judge a country’s development very differently. This is a problem, especially in the EU, where countries are more similar in digital development than in Pacific Asia.

Contribution & Value Added: The study compares digitalisation indexes from a quantitative perspective that has not yet been established in the literature. It shows how different indexes perform in ranking and clustering procedures. Researchers can use our article as a guide in choosing digitalisation indexes for the EU and ASEAN countries.

Keywords

digitalisation index, index comparison, clustering, ASEAN, EU

Author Biography

Agnieszka Choczyńska

Agnieszka Choczyńska is a research and teaching assistant. Her research interests include Financial Markets, Econometrics, and Economic Sentiment.

Septia Rani

Septia Rani is a research and teaching assistant. Her research interests include Artificial Intelligence, Data Science, and Information Hiding.

Justyna Tora

Justyna Tora is a research and teaching assistant. Her research interests include Econometrics and Demand Modelling.

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