Rethinking growth and innovation: The role of artificial intelligence in Europe's industrial transformation

Cristian-Radu Spătaru · Valer Bocan · Cătălin C. Popescu

In a global economic environment characterized by interdependence, structural transformations, and increasingly intense competitive pressures, the ability of economic systems to generate, sustain, and capitalize on research, development, and innovation (RDI) has become a key performance indicator. Artificial intelligence (AI), a strategic component of the Fourth Industrial Revolution, exerts a profound impact on the economic architecture and operational mechanisms of contemporary societies. While AI offers innovative solutions with high potential to support socio-economic progress, it also poses significant regulatory and ethical challenges. This study employs a mixed-methods approach, consisting of a review of the relevant scholarly literature and a quantitative analysis using a multiple regression econometric model to examine the main determinants of the variable "AI software development. Very High-impact AI projects (%)", based on data from the EU27 member states during the 2017–2022 period. The findings contribute to the existing literature and provide valuable insights for policymakers, investors, and industry leaders in designing effective strategies to accelerate technological progress and maximize the economic and social benefits of AI. At the same time, the study highlights the need for coherent and harmonized regulatory frameworks at the global level to address the risks associated with AI deployment - an issue that could serve as a basis for future research.