Digital

Buzzword “Digital“: Global interconnection, dramatically increased computing power and the spread of portable multi-purpose mini-computers, the smartphone, over the last years have initiated far-reaching societal and economic changes. The topic thus surged to the top of the agenda in business, politics, media and research. The feedback of technological developments to socioeconomic processes is certainly not new but rather on the contrary runs like a thread through human history. However, the potential implications of current rapid progress in particular in the fields of artificial intelligence and robotics together with the proliferation of platform- and data-based business models are so far-reaching that both optimists and pessimists offer wild speculations on how this could influence the societies and economies of tomorrow. But what will turn out to be lasting developments, short-lived hypes or simple exaggerations?

August 22, 2019

Digital politics: AI, big data and the future of democracy

Region:

Europe

EU Monitor

Topic:

Digital, Economic and european policy

Analyst:

Kevin Koerner

The digital transformation has enriched societal discourse through new forms of multilateral communication, but it has also amplified the spread of misinformation, echo chambers and propaganda, offering authoritarian states new means of surveillance and control. How democracies approach this challenge will be a key factor in their performance, given intensifying competition among political systems. [more]

July 22, 2019

Libra – a global challenger in payments and for central banks?

Region:

International

EU Monitor

Topic:

Banking and financial markets, Digital

Analyst:

Heike Mai

Facebook’s Libra project aims to establish both a private digital currency backed by a basket of hard currencies and a global payment network. It is thus challenging many established players in the financial system, including central banks, credit institutions and payment providers. Facebook can integrate Libra services into its digital platforms and benefit from strong network effects. In Europe, Libra would enter a competitive but fragmented digital payments market. As a currency, Libra will carry a foreign exchange risk for Europeans. But if the ECB drove interest rates deeply below zero, Libra could offer an easy digital way out. The flipside, though, would be a loss of sovereignty for Europe. [more]

July 2, 2019

Cash empowers the individual through data protection

Region:

International

Talking Point

Topic:

Banking and financial markets, Digital

Analyst:

Heike Mai

By providing a high degree of privacy in payments, cash helps to slow the growing information asymmetry between consumers and companies as well as between citizens and public authorities. As knowledge about your counterparty is power, privacy is crucial for individuals to safeguard their position when dealing with organisations which are more powerful than a single person. [more]

June 4, 2019

Artificial intelligence in banking: A lever for profitability with limited implementation to date

Region:

Europe

EU Monitor

Topic:

Banking and financial markets, Digital

Analyst:

Orçun Kaya

Artificial intelligence (AI) is a significant step forward in the digitalisation and transformation of modern businesses. Investors are lining up to be part of the imminent change. AI attracted USD 24 bn in investments globally in 2018, a twelvefold increase since 2013. Within Europe, Germany, France and the UK are the frontrunners in experimentation and in the implementation of AI. Similar to earlier examples of information technology (IT) implementation in financial services, AI promises great efficiency gains and potential revenue increases and its potential contribution to bank profitability should not be underestimated. [more]

May 21, 2019

Taxing the digital economy: Good reasons for scepticism

Region:

Europe

EU Monitor

Topic:

Digital, Economic and european policy

Analyst:

Dieter Bräuninger

Digital taxation is currently a subject of intense debate and since large digital companies are widely thought to pay inappropriately low taxes, policymakers remain under pressure to act. However, all approaches which are based on the taxation of revenues instead of profits have major flaws. As digital services expand into ever new areas of the economy (‘smart everything’), the risk of a far-reaching, arbitrary taxation of entrepreneurial activities is increasing. Disruption, the buzzword of the digitalisation discussions, may become an issue in international tax policy, too. In addition to an (international) digital tax, minimum taxes are one of the concepts under discussion. [more]

March 26, 2019

Video: Global digital leadership: A two-horse race?

Region:

International

dbInSights - public

Topic:

Digital, Macroeconomics

Analyst:

Kevin Koerner

In the competition for global leadership in technologies like artificial intelligence, most observers see a two-horse race – between China and the United States. But what about Europe? Can it ever catch up to the galloping favorites? It won’t be easy. The digital economy in the United States has big advantages: a large domestic market, a risk-taking investment culture, and plenty of innovative companies and world-class universities. US tech giants were first-movers out of the gates, and used the network effects of the platform economy to dominate not only the US, but many other markets worldwide. [more]

March 25, 2019

Digital structural change and the welfare state in the 21st century

Region:

Europe

EU Monitor

Topic:

Digital, Economic and european policy

Analyst:

Sebastian Becker

While digitalisation does promise significant additional prosperity, it also threatens to lead to higher inequality. A major automation wave or increasingly capital-intensive production would reduce the overall wage share and raise corporate and capital income. According to our scenario analysis, the EU countries would, on average, have to deal with a huge annual fiscal deficit if automation dramatically reduced employment. It is uncertain how digitalisation will affect the demand for labour and the public finances. Nevertheless, governments should try and prepare their countries for the future, for example by paying more attention to education policy and adapting the international tax system to the realities of the 21st century, for example in the field of corporate taxation. [more]

December 12, 2018

The multiple stages of the blockchain revolution – or into the crypto future and back

Region:

Topic:

Analyst:

Since the rally in 2017, the buzzwords bitcoin and blockchain have been omnipresent in the public. Still, the understanding of how much potential the technology actually offers is often rudimentary. To shed more light onto the discussion, we discuss the manifold technological facets as well as the social changes that might come on the heels of the technology. After outlining the utopia, we point out the technical as well as the social hurdles that are standing in the way of the revolution. [more]

November 8, 2018

Industry 4.0 – digitalisation to mitigate demographic pressure

Region:

Germany

Germany Monitor

Topic:

Digital, Sectors and resources

Analyst:

Josef Auer

With digitalisation becoming an ever more common feature along the value chain, the German industry looks set to enjoy higher potential growth in the coming years. The additional gross value added in German manufacturing might total EUR 70–140 bn for the years between 2018 and 2025. As a rule, the industrial sector is in a better position than numerous (personal) services sectors to benefit from the favourable impact of digitalisation. Traditional capital goods producers, such as the auto industry or mechanical and electrical engineering, are likely to see their gross value creation benefit more strongly from digitalisation than the metals or chemicals sector. [more]

October 12, 2018

Digital infrastructure: Bottlenecks hamper Europe's progress

Region:

Europe

EU Monitor

Topic:

Digital, Sectors and resources

Analyst:

Eric Heymann, Kevin Koerner

During the last few years, the expansion of digital infrastructure in the EU has been carried out more slowly and less comprehensively than politically intended. The EU’s objective of ensuring fast broadband coverage of more than 30 megabits per second for all Europeans by 2020 seems out of reach. There are economic and regulatory reasons for the insufficient progress with digital infrastructure improvements. However, inadequate digital infrastructure puts companies at a disadvantage versus US competitors, but increasingly also versus Chinese players. The European Commission estimates that more than EUR 500 bn will need to be invested by 2025 to achieve the goal of a “gigabit society”. [more]

1 2 3 4 5



