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What is holding back artificial intelligence adoption in Europe? Bruegel Policy Contribution Issue n ̊24/21 | November 2021.

Hoffmann, Mia and Nurski, Laura (2021) What is holding back artificial intelligence adoption in Europe? Bruegel Policy Contribution Issue n ̊24/21 | November 2021. [Policy Paper]

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    Abstract

    Artificial intelligence (AI) is considered a key driver of future economic development, expected to increase labour productivity and economic growth worldwide. To realise these gains, AI technologies need to be adopted by companies and integrated into their operations. However, it is unclear what the current level of AI adoption by European firms actually is. Estimates vary widely because of uneven data collection and lack of a standard definition and taxonomy of AI. What is clear is that AI adoption in Europe is low and likely running behind other parts of the world. Discussions on the barriers to AI advancement often mix up different stages of innovation – research, development and adoption. Each stage is constrained by the availability of skills, data and financing in the European market, but there are nuances in how these barriers arise in each of the three stages. This policy contribution focuses on the final stage, AI adoption. We discuss theoretical and empirical evidence of the drivers of AI adoption. We outline the relevant barriers to adoption for European firms in terms of human capital, data availability and funding, and make international comparisons where possible. To accelerate the roll-out of AI technology across the European Union, policymakers should alleviate constraints to adoption faced by firms, both in the environmental context – labour market, financial market and regulation – and in the technological context – data availability, basic digitisation of businesses and technological uncertainty.

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    Item Type: Policy Paper
    Subjects for non-EU documents: EU policies and themes > Policies & related activities > innovation policy
    EU policies and themes > Policies & related activities > economic and financial affairs > economic growth
    EU policies and themes > Policies & related activities > economic and financial affairs > digital economy
    Subjects for EU documents: UNSPECIFIED
    EU Series and Periodicals: UNSPECIFIED
    EU Annual Reports: UNSPECIFIED
    Series: Series > Bruegel (Brussels) > Policy Contributions
    Depositing User: Daniel Pennell
    Official EU Document: No
    Language: English
    Date Deposited: 05 Jan 2022 13:37
    Number of Pages: 19
    Last Modified: 05 Jan 2022 13:37
    URI: http://aei.pitt.edu/id/eprint/103772

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