Modeling the impact of investments in smart technology on the development of the manufacturing industry on the example of Germany

One of the main trends observed in the manufacturing sector at the current stage of economic development is the introduction of smart technologies, i.e. innovative solutions that integrate sensors, automation, artificial intelligence and the Internet of Things, to increase the efficiency, accuracy and flexibility of production processes. Leading countries in this area, in particular the USA, China and EU countries, are implementing various measures to stimulate the development of smart industry, including budgetary and fiscal one, with a total cost of tens of billions of dollars per year, however, less economically developed countries need to choose the most effective directions of resource allocation, which requires assessing the impact of investments on the performance of the manufacturing sector. The article is devoted to the analysis of the impact of investments in smart technologies on the development of the manufacturing industry using the example of Germany, which is the largest economy in the Eurozone and one of the leaders in the development of smart industry. For this purpose, a production function model was built that takes into account not only traditional production factors, such as labor and capital, but also the factor of digitalization.