Frontiers vs catch-up countries: Multi-group PLS for assessing the influence of digitalization, science, technology, and ICT trade on economic globalization

Abstract

The successful adoption of innovative digital technologies, exponential information growth and knowledge accumulation empower modern civilization to merge into global networks, aligning with worldwide progress. Economic globalization integrates the national economies into the global market. Variations in economic globalization intensity across economies prompt this analysis to investigate the effects of digitalization, science and technology, and international trade in information and communication technology (ICT) on the intensity of economic globalization in two groups of countries. The dataset comprises data from 33 European countries gathered over the period from 2010 to 2019, categorized by the KOF globalization index. The statistical methodology employed in this study is based on the application of partial least squares structural equation modeling (PLS-SEM). The Multi-Group Analysis (MGA) is used to identify differences in patterns of influence in countries with varying intensities of economic globalization divided into frontiers and catch-up countries. Research findings indicate positive effects of digitalization, science and technology, and ICT trade on economic globalization in pooled data, but the link for digitalization is not statistically significant. However, MGA results uncovered that statistically significant differences between analyzed groups of countries exist in path coefficients reflecting the impact of digitalization and science and technology on economic liberalization.