How to Facilitate Digital Innovation in Europe

Abstract

Digital technologies have the potential to modernise the economy. But digital innovations are disruptive. Therefore, policies need to be comprehensive and go beyond the support of the ICT sector as well as address a variety of issues: increasing returns to the use of data, heterogeneity of the digital innovation actors and ecosystem, digital skills in the non-ICT sectors, entrepreneurial culture, funding for scaling-up of new entrants, technological interoperability and intellectual property protection. At the same time, they need to counterbalance the costs of digitally driven disruptions. This paper highlights the main peculiarities of digital innovation and its implications for policies aiming at reaping the benefits of digital technologies.