The role of national intellectual capital in the digital transformation of EU countries. Another digital divide?

Purpose This study, an exploratory one, aims to empirically investigate the association of national intellectual capital (NIC) with the national digital transformation readiness of the European Union's (EU’s) member states. Apart from building the conceptual model of NIC, this study explores the role of NIC dimensions in the digital divide between European countries. Design/methodology/approach Based on the literature review and the available EU statistical data and indexes, the theoretical framework and conceptual model for NIC were developed. The model explores the relation of NIC and its dimensions (human, social, structural, relational and renewable/development capital) on the readiness of European countries for digital transformation and the digital divide. Significant differences between EU countries in NIC and digital readiness were tested. Multiple linear regression was used to explore the association of each NIC dimension with digital transformation and digital divide within the EU. Findings Despite a positive association between all dimensions of NIC and digital transformation readiness, the proposed model of NIC was not confirmed in full. Regression analysis proved social capital and working skills, a dimension of human capital, to be the predictors of digital transformation at a national level, able to detect certain elements of digital divide between EU member states. Structural capital, knowledge and education, as dimensions of human capital, were predictors of the digital divide in terms of the integration of digital media in companies. Research limitations/implications This research has a limited propensity for generalisation due to the lack of common measurement models in the field of NIC exploration. Practical implications This research offers policy makers an indication of the relationships between NIC and digital transformation, pointing out which dimensions of NIC should be strengthened to allow the EU to meet the challenges of digital economy and to overcome the digital divide between EU member states. Social implications The use of digital technologies is key in creating active and informed citizens in the public sphere and productive companies and economic growth in the business sphere. Originality/value This study provides an original theoretical framework and conceptual model through which to analyse the relationship between NIC and digital transformation, which has thus far not been explored at the level of the EU. This research makes an original contribution to the empirical exploration of NIC and produces new insights in the fields of digital transformation and intellectual capital.