The BMC_DEISI is a composite index that aggregates a large number of published indicators reflecting various key factors of the information society and digital economy. Such factors should be exhaustive and hence capture different aspects such as inputs (drivers), enablers (regulation and business environment), outcomes and outputs (performance), and impacts.
The conceptual framework is composed of five sub-indices with their sub-pillars: Human Capital; ICT Readiness; Governance; ICT Adoption and Usage; and Economic & Social Impact. It includes 58 indicators, two of them are indices, to populate the 5 pillars and 10 sub-pillars.
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Bmc_Digital_Economy_Information_Society_Index
1. A Proposal of a Digital
Economy &
Information Society
Index
M. Bouanane – Consulting Director
October 2020
The BMC_DEISI is a composite index that aggregates a
large number of published indicators reflecting various
key factors of the information society and digital
economy. Such factors should be exhaustive and hence
capture different aspects such as inputs (drivers),
enablers (regulation and business environment),
outcomes and outputs (performance), and impacts.
The conceptual framework is composed of five sub-
indices with their sub-pillars: Human Capital; ICT
Readiness; Governance; ICT Adoption and Usage; and
Economic & Social Impact. It includes 58 indicators,
two of them are indices, to populate the 5 pillars and
10 sub-pillars.
The indicators are normalized – using the Min-Max
method – in order to transform the values of each data
into the same unit of measurement and make them
comparable for data aggregation.
The computation of the BMC_DEISI is a successive
aggregations of normalized scores. A weighted
arithmetic average is used to aggregate, individual
indicators within each sub-pillar, and different sub-
pillars within each pillar. A larger weight is given to
heavily penalize countries that are badly performing.
The overall index score is then the sum of weighted
sub-indices.
2. The BMC Digital Economy & Information Society Index
The BMC Digital Economy & Information Society Index – Conceptual
Framework
The adopted approach aggregates a large number of published indicators reflecting various key factors of
the information society and digital economy. This approach aims to select the most relevant indicators for
the largest number of countries, and therefore avoid creating new indicators that might be difficult to
collect, assess and maintain. In addition, data availability and quality is highly important to ensure data
comparability across countries overtime.
The development process towards a digital economy should be depicted through different dimensions –
pillars that combine the most useful and necessary factors. Such factors should be exhaustive and hence
capture different aspects such as inputs (drivers), enablers (regulation and business environment),
outcomes and outputs (performance), and impacts. Among these factors, ICT development enablers are
critical to build an information society or digital based economy. However, the human capital’s component
is of high importance and captures both the input and the impact of well educated and skilled people on all
other factors choices, and determine the effective adoption and use of technologies, services and content,
to unleash their full potential for economic development and social well-being.
Considering the complex interactions between different components within the same dimension and
between the different pillars, the BMC_DEISI conceptual framework is composed of five sub-indices with
their sub-pillars:
I. Human Capital (7 indicators): It captures the level of strengthening investments in developing
human capital, fundamental for the participation – as citizenship and workforce – in the information
society and digital economy to achieve social and economic well-being outcomes (Data are
collected by UN1
and NRI2
).
II. ICT Readiness (12 indicators): It reflects the level of ICT readiness for a networked society and
economy, and includes three sub-pillars (Data are collected by ITU3
and NRI):
1. Infrastructure (4 indicators): It captures the status of the development of the
telecommunications infrastructure;
2. Access (3 indicators): It reflects the fundamental level of access to basic ICTs;
3. Technology, Content and Services (5 indicators): It seeks to assess the level of technology and
local content availability, as well as the extent of production of online services and the quality of
e-participation of the population.
III. Governance (14 indicators): It seeks to capture how conducive a country national environment is for
the population’s participation in the digital economy based on elements of trust, security,
regulation and affordability. It is composed of two sub-pillars:
1. Trust and Security (5 indicators) It captures the perceptions of safety, security and privacy by
individuals and businesses and their trust in the rule of law in the context of the digital
economy (Data are collected by NRI);
1 United Nations: E-Government Survey (EGDI) 2018 – Human Capital Index (HCI) and its components.
2 Networked Readiness Index 2019 – Towards a Future-Ready Society; by Portulans Institute and WITSA, March
2020.
3 Measuring the Information Society Report 2019, ITU 2020.
M. Bouanane 2 / 9
3. The BMC Digital Economy & Information Society Index
2. Regulation (9 indicators): It captures how the government promotes the participation of
businesses and individuals in the digital economy through regulation and legislation (4
indicators. Data are collected by NRI), as well as the affordability (5 indicators) reflecting the
impact of the pricing factor on the adoption and usage of the ICT services. An ICT Price basket
index (Data are collected by ITU4
) is used based on $PPP when available (USD otherwise).
IV. ICT Adoption and Usage (18 indicators): It captures the intensity of ICTs adoption and usage in a
society at the levels of individuals, businesses, and government. It includes three sub-pillars:
1. Individuals (6 indicators): It captures how individuals use ICTs to participate in the networked
economy;
2. Businesses (7 indicators): It captures how businesses use and invest in digital and emerging
technologies and participate in the networked economy as well as the availability of skilled and
trained professionals;
3. Government (5 indicators): It captures how a government use technology, invest in R&D and
ease the development of business for the benefit of the population interest.
V. Economic and Inclusion Impact (7 indicators): It seeks to assess the economic and social-human
impact of the networked economy. It captures the outcomes of digital technologies use in a country
for improving the economic growth and enhancing the social inclusion. It includes two sub-pillars
(Data are collected by NRI):
1. Economy (4 indicators): It reflects the economic development and growth of high-tech industry
and labour productivity benefits;
2. Inclusion (3 indicators): It reflects the social impact and digital divides such as inequalities based
on socio-economic status, gender and rural living.
The Structure of the BMC_DEISI – Methodology
The complete structure of the BMC_DEISI with its respective pillars, sub-pillars, and indicators is shown
below. It is composed of 58 indicators, two of them are indices5
, to populate the 5 pillars and 10 sub-pillars.
The choice of indicators included in these sub-indices reflects the corresponding stage of transformation
towards the information society and digital economy. The indicators in each sub-index or sub-pillar are
directly related to, and have a close impact on, the subject.
4 Measuring Digital Development: ICT Price Trends 2019, ITU 2020.
5 The Online Service Index (OSI) and the E-Participation Index (EPI) from the UN E-Government Development Index
(EGDI).
M. Bouanane 3 / 9
4. The BMC Digital Economy & Information Society Index
Computation and Data Coverage
Only countries with data available for at least 60% of indicators per pillar are included in the BMC_DEISI.
Missing values are not taken into account in the computation of scores.
The computation of the BMC_DEISI is a successive aggregations of normalized scores, from the indicator
level (i.e. the most disaggregated level) to the overall score. A weighted arithmetic average has been used
to aggregate, individual indicators within each sub-pillar, and different sub-pillars within each pillar, and
then the pillars composing the overall index. The two exceptions are made for the OSI and the EPI, that are
indices made for the computation of the E-Government Index, and used as they are published by the United
Nations.
Normalization and Weighting
The indicators are normalized in order to transform the values of each data into the same unit of
measurement and make them comparable for data aggregation. The BMC_DEISI follows the Min-Max
normalization method so that all values fall into the [0, 100] range, with higher scores representing better
outcomes and lower scores imply worse outcomes.
As shown in the Table below, the weights – relative importance and impact – applied to individual indicators
and sub-indices are appropriately selected based on the correlation between indicators and their
importance within each sub-pillar and pillar, using the standard deviation of the population: a larger weight
is given to heavily penalize countries that are badly performing.
The weights are applied to each indicator, sub-pillar and pillar and used to calculate sub-indices' scores. The
overall index score is then the sum of weighted sub-indices.
Human Capital Pillar 16,60 %
Adult literacy UN EGDI 2018 24,60 %
Gross enrolment ratio UN EGDI 2018 14,20 %
Expected year of schooling UN EGDI 2018 14,19 %
Mean years of schooling UN EGDI 2018 12,64 %
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5. The BMC Digital Economy & Information Society Index
Reading proficiency in schools NRI 2019 11,04 %
Math proficiency in schools NRI 2019 11,61 %
ICT skills NRI 2019 11,72 %
ICT Readiness Pillar 17,86 %
Infrastructure sub-pillar 46,65 %
3G mobile network coverage ITU MISR 2018 32,66 %
4G mobile network coverage ITU MISR 2018 15,10 %
Fixed-broadband subscriptions >=10Mbps ITU MISR 2018 14,53 %
International Internet bandwidth ITU MISR 2018 37,71 %
Access sub-pillar 20,40 %
Internet access in schools NRI 2019 29,45 %
Households with a computer % ITU MISR 2018 34,80 %
Households with Internet access % ITU MISR 2018 35,74 %
Technology, Content & Services sub-pillar 32,95 %
E-Participation Index UN EGDI 2018 20,73 %
Government online services Index UN EGDI 2018 19,54 %
Availability of local online content NRI 2019 18,35 %
Availability of latest technologies NRI 2019 19,62 %
Computer software spending NRI 2019 21,75 %
Governance Pillar 22,85 %
Trust & Security sub-pillar 37,36 %
Rule of law NRI 2019 21,66 %
Software piracy rate NRI 2019 15,86 %
Secure Internet servers NRI 2019 20,10 %
Cybersecurity NRI 2019 17,26 %
Online trust and safety NRI 2019 25,11 %
Regulation sub-pillar 62,64 %
Regulatory quality NRI 2019 16,02 %
Legal framework's adaptability to digital business models NRI 2019 16,21 %
E-commerce legislation NRI 2019 12,64 %
ICT regulatory environment NRI 2019 17,21 %
ICT Price Basket Index ITU ICT Price 2019 37,91 %
ICT Adoption & Usage Pillar 20,48 %
Individuals sub-pillar 38,49 %
Fixed telephone subscriptions ITU MISR 2018 21,33 %
Mobile cellular telephone subscriptions ITU MISR 2018 23,61 %
Percentage of Individuals using the Internet ITU MISR 2018 10,74 %
Active mobile-broadband subscriptions ITU MISR 2018 23,12 %
Fixed broadband subscriptions ITU MISR 2018 10,89 %
Internet shopping NRI 2019 10,30 %
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6. The BMC Digital Economy & Information Society Index
Businesses sub-pillar 29,24 %
Company investment in emerging technology NRI 2019 14,64 %
Firms with website NRI 2019 12,19 %
Professionals NRI 2019 16,11 %
Technicians and associate professionals NRI 2019 13,36 %
Extent of staff training NRI 2019 15,75 %
R&D expenditure by businesses NRI 2019 16,11 %
ICT PCT patent applications NRI 2019 11,82 %
Government sub-pillar 32,27 %
Government procurement of advanced technology products NRI 2019 22,56 %
Publication and use of open data NRI 2019 17,83 %
ICT use and government efficiency NRI 2019 21,04 %
R&D expenditure by governments and higher education NRI 2019 16,97 %
Ease of doing business NRI 2019 21,60 %
Economic & Inclusion Impact Pillar 22,20 %
Economic Impact sub-pillar 47,62 %
Medium and high-tech industry NRI 2019 26,24 %
High-tech exports NRI 2019 27,23 %
PCT patent applications NRI 2019 23,12 %
Labour productivity per employee NRI 2019 23,41 %
Inclusion Impact sub-pillar 52,38 %
Socio-economic gap in use of digital payments NRI 2019 26,66 %
Gender gap in Internet use NRI 2019 39,14 %
Rural gap in use of digital payments NRI 2019 34,20 %
The Overall Rankings
The BMC_DEISI 2020 ranks a total of 120 economies. The top performer in this year’s index is
Singapore, which is just ahead of Sweden in 2nd place, followed by Norway in 3rd place (Table 1). There is
not much separating the leading countries in the BMC_DEIS Index as reflected in their overall scores. For
instance, the top 5 countries (which also include Denmark – 4th and the Netherlands – 5th
) scores are
separated by less than a couple of points of each other. The other countries that make up the top 10 – the
United States, Switzerland, Finland, the United Kingdom, and Luxembourg – are less than 5 points away
from the top’s score. On the other hand, the differences are accentuated at the bottom of the ranking. The
last ranked 10 countries are separated from each other within an interval of almost 12 points.
The surprise comes from Yemen which, despite the war situation that reigns there, managed to produce its
data and to be in the final ranking table, compared to many other countries that are not selected due to
lack of data and despite their peaceful situation.
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