The digital economy has radically changed business models and forms of economic interaction globally. In times of the digital revolution or digital transformation’s effect, traditional players themselves must adapt their business strategies to the new parameters of market dynamics, supported, on the one hand, by artificial intelligence, big data, the intelligence of the Internet of Things (IoT), and automation. To better understand the consequences of these changes, it is necessary to begin with the definition of the economy. The economy is the study of the production, distribution, and consumption of goods and services.
In the context of this definition, all economic activities related to using digital technologies and online platforms create value and optimize productivity and efficiency within the digital economy. Currently, all countries working on the post-pandemic landscape demonstrate these gains by leveraging the weaknesses of existing models. The International Monetary Fund (IMF) concluded that the virtual economy is the largest segment, accounting for more than 15% of global GDP and stagnating at an annual growth of 7% over the next five years.
Literature review and hypotheses development
Companies that have implemented digital strategies have experienced an increase of up to 25% in their productivity, enabling them to tap into the enormous potential of these tools. Digitalization has significantly impacted different areas of the economy. In commerce, for example, e-commerce has grown by 23% in the last year, with Amazon and Alibaba leading the way. The incorporation of AI into sales platforms allows for a more personal shopping experience and improved shipping logistics.
In the financial world, digital banking and cryptocurrencies have transformed traditional financial services, offering users faster, more secure, and less expensive transactions, as well as those who provide the services. Digital payments have exploded, and according to Statista, the global volume of digital transactions will exceed $10 trillion by 2025. In the world of work, automation and artificial intelligence are driving a transformation in the demand for skills. A McKinsey study states that by 2030, more than 30% of current jobs could be automated, forcing workers to acquire new digital skills.
Digital transformation: promise and pitfalls
However, experts also estimate that digitizing the world will generate billions of new digital jobs, as well as emerging technologies such as cybersecurity and algorithmic data analysis. In healthcare, telemedicine and Artificial Intelligence are changing the way we benefit from medical services, both in terms of access and quality. The ability to make accurate diagnoses through machine learning algorithms has reduced waiting times and improved treatments. Investment in digital health is expected to exceed $600 billion in the next decade.
This researcher, who professes the amalgamation of economics and information analysis to understand the laws of the digital economy and advise businesses on the technological transformation of their processes, interacts cumulatively with the masses of big data in the digitalized market. According to LinkedIn data, the demand for these experts has increased by 40% in the last three years. Soon, the digital economy should continue to see steady growth, thanks to advances such as quantum computing, the decline of Web 3, and the development of advanced automation.
Revamping policies for the digital era
An increasingly competitive market leaves behind companies that do not incorporate some of these technological resources. The implementation of blockchain in business models seeks greater transparency in transactions and smart contracts, thereby saving costs by increasing trust in virtual markets. Furthermore, quantum computing could change the world by solving, in seconds, complex problems that take years, and make scientific advances faster and decision-making more informed. The digital economy is a structural revolution that is changing the way we interact with goods and services.
opens enormous doors but also creates challenges that exist. to resolve with adjusted solutions. Thus, the role of the digital economist, as well as of specialists in emerging technologies, will be particularly important in achieving sustainable and equitable growth in the new global era of the economy. Training with digital tools and the development of creative strategies will help companies remain competitive and professionals access opportunities.
Conclusion
Electricity and internet access, as well as their accessibility and quality, are severely lacking in LDCs. The electrification rate in LDCs is 52% (compared to a global average of 90%), and more than 500 million people lack access to electricity. Although the remaining 83% of the 1.4 billion people living in LDCs benefit from mobile broadband services (3G or higher), only 36 people are connected. Fixed broadband growth remains very low in LDCs, with only 1.6 subscribers per 100 inhabitants expected in 2022. The price of a reference triangle bundle on mobile, which entails a monthly allowance of 2 GB, amounts to almost 6% of the average monthly income in LDCs, four times the global average.
Under the guise of environmental protection, LDCs impose very high tariffs on information and communication technology products (six times higher than the OECD average), including devices used to browse the internet. Smartphone purchases represent 95% of the average monthly income of LDCs. In general, LDCs have lower educational attainment and low employment levels in science, technology, engineering, and mathematics (STEM). Worse still, they have even less access to digital skills development options.
