Digital Urbanization as a Driver of Economic Development and Smart City Transformation

Abstract

Purpose. The study explores digitalization as a driver of economic development and smart city transformation, determining its impact on urban economic productivity, resource optimization, and the development of new economic sectors. The research also assesses the strategic prospects of digitalizing urban spaces in Ukraine in the context of international experience.

Methods. The study employs a systematic approach to analyzing urban digitalization, utilizing structural-functional analysis, comparative analysis of international practices, and expert evaluation of the effectiveness of digital technology implementation in urban management.

Results. The research examines the theoretical foundations of digitalization and its significance for urban economic development. Key digital technologies, such as the Internet of Things (IoT), Big Data, artificial intelligence, and digital platforms, are identified as the foundation of smart cities. The challenges of digitalization, including unequal access to technology, cybersecurity risks, and environmental and social issues, are explored. The current state of digital transformation in Ukrainian cities is analyzed, with a focus on the role of digitalization in infrastructure recovery and economic modernization in the context of wartime and post-war challenges. Based on international experience, strategic directions for developing digital cities in Ukraine are formulated, including policy optimization, investment attraction, and the stimulation of innovation potential.

Conclusions. Urban digitalization is not merely a technological trend but a strategic development tool that ensures efficient governance, enhances city competitiveness, and strengthens economic resilience. In the Ukrainian context, digitalization becomes a crucial condition for infrastructure recovery, integration into the global digital space, and achieving sustainable development. Recommendations are proposed for implementing digital strategies that will contribute to economic stability and urban modernization in accordance with global standards.