Europe 4.0 Addressing the Digital Dilemma

With digital transformation accelerating, can everyone, everywhere, benefit? A first step is to recognize how the underlying dynamics—and economic impacts—differ across types of digital technologies. New evidence reveals that Europe, given its current performance with digital technologies, faces a dilemma if the continent wants to achieve its triple objective of competitiveness, inclusion, and convergence. The technologies help European firms using them become more competitive. However, the technologies in which European firms' performance is strongest (for example, smart robotics) are also those that concentrate activities in larger firms and leading regions. Conversely, European firms have lower rates of both creation and take-up for those technologies with the greatest potential opportunities for smaller firms and lagging regions (for example, platforms or cloud computing). The COVID-19 pandemic is re-enforcing the urgency of addressing this dilemma. Europe 4.0: Addressing the Digital Dilemma builds on two previous World Bank reports -- Golden Growth and Growing United -- which focused on Europe's convergence machine and new sources of stress facing the continent. This latest volume provides a framework, evidence, and recommendations for how to attain a dynamic and inclusive digital economy. Europe 4.0 is possible -- and Europe should take the chance.