Factors determining the path of digital technologies adoption of Brazilian industrial firms

This paper aims to identify the main factors affecting the adoption of digital technologies for a panel of 299 Brazilian industrial firms surveyed in 2017 and 2019/20. A probabilistic model is used to estimate the likelihood of certain organizational, technological, and environmental characteristics of the firms affecting digital adoption in the two survey periods. The study reveals that digital adoption has advanced but still is at an infant stage in Brazil. The econometric results point out that current adoption, size, belonging to high digital intensity industries, being an exporter, and training the workforce have a significant positive effect on digital adoption. However, skills qualification has a negative effect, suggesting that qualification on previous technologies can be more a constraint than a pre-requisite for digitalization. One must interpret such findings against growth-adverse, investment-hostile economic framework conditions where firms can react in any given direction: move forward to survive, stay put to face uncertainty, and/or backtrack defensively.