In Europe, as in the rest of the world, digital innovation and transformation foreshadow the coming of what has been called the Fourth Industrial Revolution. The concept of Industry 4.0 has emerged to describe this digital transformation in industry in all sectors. Integrating digital innovations in their business strategies is an essential means of creating value and digital integration and connection of systems may create seamless digitalised value chains.
This will revolutionise the structure and governance of markets. But automation and digitisation of production processes will also lead to a significant reconfiguration of work and employment. The change enabled by technology will give benefits but can also produce negative effects for European economies and societies.
The objective of this study is to present policy options for the use of taxation and labour market intervention in view of emerging developments in industrial digital platforms, AI and related technologies, and analyse how these options may impact economic growth and social cohesion, as well as the development of Industry 4.0 in Europe.