Logical clustering approach for analysing digital economy and society performance of countries

Abstract

Digitization, digitalization and digital transformation represent one of the primary incentives of today's development. To successfully implement these changes, countries need to create smart digital policies which are evidence- and data-based. The study presented in this paper uses the logical clustering approach for grouping countries according to five dimensions of the Digital Economy and Society Index (DESI). Logical clustering employs Interpolative Boolean Algebra (IBA) as a consistent fuzzy approach, which means that all Boolean axioms are fulfilled. To measure proximity among countries, logical clustering uses IBA-based exclusive disjunction and logical aggregation. The general aim is to provide help in identifying directions for defining smart digital policies for achieving digital competitiveness of nations, based on the analysis of similarities among countries. The results indicate that logical clustering enables more comprehensive differentiation between clusters than the original composite index methodology does, and determination of the primary areas of action in clusters, among similar countries. Some interesting cases where logical clustering results differ from the original methodology are discussed.