Mapping Digital Advances: A Comprehensive Digitalization Index for Analyzing OECD Economies

Year 2025, Volume: 12 Issue: 2, 335 - 361, 13.08.2025

Gülşah (şentürk) Kocakaya , Gülden Ülgen

https://doi.org/10.26650/JEPR1598992

Abstract

The digitalization phenomenon is defined as the adoption and widespread use of information and communication technologies (ICTs) by households, businesses, and the government as the main actors in the economy. Considering its transformative role in economic growth, innovation, and reducing inequality, digitalization has become a key dynamic of modern economies. In this context, this study proposes a novel composite index—the Digital Progress Index (DPI)—to evaluate the digitalization levels of OECD countries from 2010 to 2020. The DPI builds upon the conceptual framework of the World Bank’s Digital Adoption Index (DAI), adapting its three-dimensional structure that covers households, businesses, and government. To uncover country-specific patterns, cluster analysis is employed, classifying OECD countries into less developed, developing, and developed groups based on their DPI scores. This classification offers valuable insight into the role of digital transformation in shaping socio-economic structures.

JEL Classification : O31 , O33 , C43

Keywords

digitalization , digital economy , OECD , composite index , cluster analysis

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