Political Risks and Barriers of Digitalization

Abstract

The article deals with political risks and barriers of digitalisation. Initially, the author identified the factors of political risks and barriers to digitalisation. They include the limited state categorisation and the complexity of the institutional process, lack of investment in human capital and low overall factor productivity, lack of effective and sufficient communication, resistance to bureaucracy. On the base of these factors, the main political risks and barriers to digitalisation include (1) the formal declaration of reforms in the absence of real results, (2) the growth of centralised control and the adverse social reaction, (3) the increasing of social inequality and the formation of the new monopolies, (4) the risks of cybersecurity. Management of these risks is possible through the development of adequate institutional design, the use of new organisational solutions to stimulate the development of human capital, the establishment of the institute of the scientific and technical expertise, support of project finance for ICT projects, support of sufficient political communication.