The role of institutional factors on the growth impact of digitalization: a case of ASEAN economies

This study examined the relationship between digitalization and economic growth in ASEAN economies, with a particular focus on the role of institutional quality from a governance and management perspective. Using panel data from eight ASEAN countries over the period 2000–2023, the study applied Pooled OLS, Fixed Effects, and Random Effects models. The findings showed that digitalization had a statistically significant negative effect on economic growth, which may reflect inefficiencies, capability gaps, and challenges in integrating digital technologies effectively. The interaction between digitalization and institutional quality was not statistically significant, suggesting that existing institutional frameworks may not yet be effective in supporting decision-making and performance outcomes in digital environments. These findings pointed to a mismatch between rapid digital adoption and institutional readiness. The study contributes by highlighting the importance of governance and institutional support in shaping how digitalization translates into economic and organisational outcomes.