Last Updated: January 13, 2023

Estimated reading time: 2 minutes

Digital Economy and New Value Creation

digital value

World Bank disclosed the fact that in 2022, a whopping 60% of the global GDP depend on digital communication technologies. The whole world may connect with each other at any time and place through these devices: high-tech smartphones, tablets, and digital wristwatches along with other mobile internet devices. The digital economy enables millions to carry on the more effective buying and selling of products and services all over the world.

The “digital economy” refers to economic activities enabled by the billions of daily online connections between individuals, businesses, devices, data, and processes. These connections foster new products and services, innovative business models, and fresh ways to generate value.

Rapidly advancing technologies like the internet, mobile devices, and cloud computing drive the digital economy. These innovations have revolutionized existing businesses and created new ones. By applying digital technology and data analytics, the digital economy is creating new types of value.

Businesses can now collect and analyze huge amounts of data to improve products and services, increase efficiency, and find new customers. This data also enables the creation of new products and services, such as personalized digital marketing and enhanced online experiences.

The digital economy encourages emerging business models like the sharing economy and the on-demand economy, which involve sharing assets like homes and cars and providing services like delivery and transportation. Digital technology also enables new types of jobs, such as remote work and gig economy roles, where people are hired for specific projects.

Connecting persons, organizations, and nations to develop and promote research and entrepreneurship, the digital economy paves the path for economic growth and development. Yet it also raises some challenges such as security and privacy issues and may also destabilize some existing industries and even the work of their employees.

Overall, new business model and methods of value generation are always being opened up by digital economies. It has developed opportunities in regard to the economy, and has a lot to contribute to the global economy, despite its few challenges. Governments, international organizations, and businesses should build policies together and practice fair, inclusive, and sustainable digital economy.

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