Digitalization is widely expected to improve government effectiveness; however, empirical evidence remains inconclusive, particularly regarding the roles of institutional quality and regional heterogeneity. This study examines the relationship between digitalization and government effectiveness, with regulatory quality as a moderating factor, using panel data from 14 Asian and European countries over the period 2007–2023. A fixed-effects panel regression model is employed with a principal component analysis (PCA)-based digitalization index, incorporating both quadratic and interaction terms to capture nonlinear and conditional effects. The study contributes to the digital governance literature by jointly examining the direct, nonlinear, moderating, and regional dimensions of the digitalization–government effectiveness relationship within a unified analytical framework. The findings indicate that digitalization alone does not have a significant linear effect on government effectiveness, while its nonlinear effect is significantly negative. In contrast, regulatory quality significantly strengthens the positive impact of digitalization, with the moderating effect being more pronounced in European countries than in Asian economies. These findings suggest that the governance benefits of digital transformation depend not only on technological advancement but also on strong regulatory institutions that enable digital governance.
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