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The digital economy is growing fast, especially in developing countries. Yet the meaning and metrics of the digital economy are both limited and divergent. The aim of this paper is to review what is currently known in order to develop a definition of the digital economy, and an estimate of its size. The paper argues there are three scopes of relevance. The core of the digital economy is the 'digital sector': the IT/ICT sector producing foundational digital goods and services. The true 'digital economy' - defined as "that part of economic output derived solely or primarily from digital technologies with a business model based on digital goods or services" - consists of the digital sector plus emerging digital and platform services. The widest scope - use of ICTs in all economic fields - is here referred to as the 'digitalised economy'. Following a review of measurement challenges, the paper estimates the digital economy as defined here to make up around 5% of global GDP and 3% of global employment. Behind this lies significant unevenness: the global North has had the lion's share of the digital economy to date, but growth rates are fastest in the global South. Yet potential growth could be much higher: further research to understand more about the barriers to and impacts of the digital economy in developing countries is therefore a priority.
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Development Informatics
Working Paper Series
The Development Informatics working paper series discusses the broad issues surrounding digital
data, information, knowledge, information systems, and information and communication
technologies in the process of socio-economic development
Paper No. 68
Defining, Conceptualising and
Measuring the Digital
Developed as part of DIODE: the “Development
Implications of Digital Economies” strategic research
network, funded by the UK’s Economic and Social
Research Council as part of the Global Challenges
Research Fund initiative
ISBN: 978-1-905469-62-8
Centre for Development Informatics
Global Development Institute, SEED
University of Manchester, Arthur Lewis Building, Manchester, M13 9PL, UK
Email: Web:
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Table of Contents
ABSTRACT .................................................................................................................................. 1
A. INTRODUCTION ............................................................................................................ 2
B. DEFINING AND CONCEPTUALISING THE DIGITAL ECONOMY .......................................... 4
B1. DEFINING THE DIGITAL ECONOMY ............................................................................................. 4
B2. CONCEPTUALISING THE DIGITAL ECONOMY ............................................................................... 11
C. MEASURING THE DIGITAL ECONOMY .......................................................................... 15
C1. OVERALL SIZE OF THE DIGITAL ECONOMY ................................................................................. 16
C2. FEATURES OF THE DIGITAL ECONOMY ...................................................................................... 17
D. SUMMARY ................................................................................................................. 20
REFERENCES ............................................................................................................................. 21
Manchester Centre for Development Informatics Working Paper 68
Defining, Conceptualising and Measuring the
Digital Economy
Rumana Bukht & Richard Heeks
Centre for Development Informatics, University of Manchester, UK
The digital economy is growing fast, especially in developing countries. Yet the meaning and metrics
of the digital economy are both limited and divergent. The aim of this paper is to review what is
currently known in order to develop a definition of the digital economy, and an estimate of its size.
The paper argues there are three scopes of relevance. The core of the digital economy is the digital
sector: the IT/ICT sector producing foundational digital goods and services. The true digital
economy defined as “that part of economic output derived solely or primarily from digital
technologies with a business model based on digital goods or services” – consists of the digital sector
plus emerging digital and platform services. The widest scope use of ICTs in all economic fields is
here referred to as the digitalised economy. Following a review of measurement challenges, the
paper estimates the digital economy as defined here to make up around 5% of global GDP and 3% of
global employment. Behind this lies significant unevenness: the global North has had the lion’s
share of the digital economy to date, but growth rates are fastest in the global South. Yet potential
growth could be much higher: further research to understand more about the barriers to and
impacts of the digital economy in developing countries is therefore a priority.
Manchester Centre for Development Informatics Working Paper 68
A. Introduction
The digital economy is a recently-emerging phenomenon of increasing importance given estimates
of double-digit annual growth around the world, with particularly strong growth in the global South
(WEF 2015). The driving forces behind this emergence are economic and political, but they of course
also have roots in technological innovation (itself shaped by wider forces). In the 1990s, economic
changes were associated mainly with emergence of the Internet, and this remains a foundation for
growth of the digital economy. But during the 2000s and 2010s a succession of new information and
communication technologies (ICTs) has diffused and underpinned economic change. This includes
the embedding of connected sensors into more and more objects (the Internet of things); new end-
user devices (mobile phones, smartphones, tablets, netbooks, laptops, 3D printers); new digital
models (cloud computing, digital platforms, digital services); growing intensity of data usage through
spread of big data, data analytics and algorithmic decision-making; and new automation and
robotics technologies (OECD 2015).
Arising from these technologies is a set of digital affordances: potential actions an individual or
organisation with a purpose can undertake with a digital system within the context of the
environment within which they function (Heeks 2017). These include datafication (an expansion of
the phenomena about which data are held), digitisation (conversion of all parts of the information
value chain from analogue to digital), virtualisation (physical disembedding of processes), and
generativity (use of data and technologies in ways not planned at their origination through
reprogramming and recombination) (Heeks 2016). The impact of any technology can be understood
as the product of its scale of diffusion and depth of effect (Handel 2015). With rapid diffusion
including in developing countries and increasing depth of effect with ever-stronger affordances,
the impact of digital technologies on the economy is growing fast.
That impact can be understood as a disruption of existing economic processes, systems and sectors,
re-shaping existing consumer behaviour, business interactions and business models (Dahlman et al.
2016). It can also be understood as the emergence of new economic processes, systems and
sectors. Within individual sectors, we see this readily reflected in dominance of new firms: Uber
(world’s largest “taxi” company), Facebook (world’s most popular media company), Alibaba (world’s
biggest and most valuable retailer) and Airbnb (world’s largest “hotelier”). And new business
models come to dominate the discourse even if not yet the economic realities: the notion of
“Industry 4.0” (see Figure 1), for example.
Manchester Centre for Development Informatics Working Paper 68
Figure 1: Industry 4.0 framework and contributing digital technologies
Source: Geissbauer et al. (2016)
One model that emerges from a mix of discourse and reality is the notion of the digital economy,
argued by some to be the leading driver of economic growth and to lead to “life-changing economic
upheavals” and “profound regional implications on businesses, jobs and people” (Brynjolfsson &
Kahin 2000, Bahl 2016). For developing countries, there is significant promise that the digital
economy will boost economic growth, raise productivity of capital and labour, lower transaction
costs and facilitate access to global markets (Dahlman et al. 2016). These are not just empty words:
the digital economy is growing 15-25% per year in emerging markets (WEF 2015). There are specific
digital dividends already observed that may counter-act economic inequalities: above-local-average
wages for digital labour in the global South potentially leading to global convergence of incomes
(Beerepoot & Lambregts 2015); new and unique local markets for digital start-ups within developing
countries (Quinones et al. 2015); and digital platforms in the global South providing an escape route
from ineffective, corrupt market and labour institutions (Lehdonvirta 2016).
Alongside these opportunities, though, are various challenges. There are dangers of exclusion from
opportunities, for example due to low levels of digital skill and technology penetration both within
and between countries (Dahlman et al. 2016). There are dangers of adverse incorporation into the
digital economy due to liminality (lack of resources, capabilities, institutions, relations) (Murphy &
Carmody 2015); specific volatility of developing country digital enterprises (Foster & Heeks 2010);
and marginalisation of developing country workers within any strengthening of digital labour driven
from and for the global North (Martin 2016). There are dangers of digital economy disbenefits, both
specifically within developing countries, e.g. growth in vulnerabilities around digital security and
privacy (Manyika et al. 2013) and between global North and South, e.g. risks that digital technologies
will contribute to the “re-shoring of production” and thus augment “premature deindustrialisation
across the developing world (Dahlman et al. 2016, Rodrik 2016).
Yet, despite these huge opportunities and threats relating developing countries and the digital
economy, most research and policy advice has focused on high-income countries. The implications
for low- and middle-income countries in the global South, at the level of government, firms and
workers, are under-researched. Hence, the formation in 2017 of the “Development Implications of
Manchester Centre for Development Informatics Working Paper 68
Digital Economies” (DIODE) strategic research network, funded by the UK’s Economic and Social
Research Council as part of the Global Challenges Research Fund initiative.
A first recognition within the network was that the notion of the digital economy itself needed and
lacked clarification as the digital economy has become “increasingly blurred ... and intertwined
with the traditional economy” (EC 2013). The purpose of this paper is therefore to undertake a
review of literature on the digital economy in order to understand definition, conceptualisation and
measurement of this phenomenon. The paper begins with definitions, introducing a three-scope
approach to understanding the digital economy. Following a graphical and analytical
conceptualisation, it then discusses ways in which the digital economy has been measured.
B. Defining and Conceptualising the Digital Economy
B1. Defining the Digital Economy
Table 1 lists a whole series of definitions of “digital economy” that have arisen over time since the
typically-cited origin of the term: Don Tapscott’s The Digital Economy: Promise and Peril in the Age of
Networked Intelligence (Tapscott 1996). A few sources dodge a specific definition; for example
identifying the digital economy instead as a “complex structure” (European Parliament 2015), or as
being understood “less as a concept and more as a way of doing things” (Elmasry et al. 2016).1 But
most do provide a specific definition with a number of recent definitions being simple and
straightforward variants of, “an economy based on digital technologies” (EC 2013).2
Definitions are always a reflection of the times and trends from which they emerge. One can see
this in the technologies encompassed. Early definitions (Tapscott 1996, Lane 1999, Mesenbourg
2001) focus specifically on the Internet; reflecting its emergence during the 1990s as a mainstream
technology, at least in the global North. Later definitions add new technologies such as mobile and
sensor networks (DBCDE 2009), and cloud computing and big data (G20 DETF 2016). Or they opt for
the more generic notion of “digital technologies” as per the simple definitions.
One can also see historical specificity in the scope of the definition. Early definitions sought to justify
their differentiation from earlier ideas such as the information economy3 (and the related but
1 Including Haltiwanger & Jarmin (2000) who state, “We must start, however, by defining what we mean by the
digital economy”, and then do not provide a definition; and OECD (2015) which contains nearly 300 pages of
discussion specifically about the digital economy without providing a definition.
2 Very similar definitions are offered by British Computer Society (2014), Charoen (2015), Rouse (2016) as well
as the Oxford Dictionary (OUP 2017).
3 Though not explored in detail here, we recognise other terms used to represent concepts similar to “digital
economy” (Brynjolfsson & Kahin 2000b, Srinivas & Yasmeen 2017). “Internet economy” (and its lesser twin,
“web economy”) arose in the 1990s and will be discussed further in the section on measurement. “New
economy” flared for a while around the turn of the century but did not gain sufficient momentum to last.
“Network economy” has had more longevity but is even harder to define and delimit than digital economy as
its focus is structural rather than technological.
Manchester Centre for Development Informatics Working Paper 68
broader idea of the information society). Tapscott (1996), for example, argued the digital economy
to encompass two generations of economic activity. The first was informational and compromised
of basic tasks such as putting up static information on websites, but the second related to
communication, reflecting the more interactional activities enabled by the Internet. Similarly,
Brynjolfsson & Kahin (2000b) state:
The term “information economy” has come to mean the broad, long-term trend toward the
expansion of information- and knowledge- based assets and value relative to the tangible assets and
products associated with agriculture, mining, and manufacturing. The term “digital economy” refers
specifically to the recent and still largely unrealized transformation of all sectors of the economy by
the computer-enabled digitization of information.
These authors were therefore seeking to demonstrate that something beyond earlier informational
ideas was underway.
Simultaneously, the ability of the Internet to facilitate commercial transactions was being recognised
and incorporated into digital economy definitions. At the turn of the century, the US Commerce
Department’s report, The Emerging Digital Economy, placed IT-enabled business activities into its
definition (Margherio et al. 1999). This was made more explicit in 2000 in the edited volume,
Understanding the Digital Economy (Brynjolfsson & Kahin 2000a) in which both editors and
contributors (Brynjolfsson & Kahin 2000b, Kling & Lamb 2000) incorporated e-commerce into the
scope of the digital economy; this being the period of the bubble.
These definitions also marked the initial appearance of two important features found in some digital
economy definitions. First, a differentiation into components. For example, Kling & Lamb (ibid.)
built on Margherio et al. (1999) to identify four parts to the digital economy:
“Highly digital goods and services: These are goods that are delivered digitally and services of which
substantial portions are delivered digitally [e.g. online information services, software sales, online
education]. …
Mixed digital goods and services: … the retail sale of tangible goods [e.g. books, flowers, hotel rooms
plus associated sales and marketing] …
IT-intensive services or goods production: services that depend critically on IT for their provision [e.g.
accounting services or complex engineering design] … manufacture of tangible goods in whose
production IT is critical (such as precision machining that uses computerized numerical control or
chemical process plants that are controlled by computer) …
The segments of the IT industry that support these three segments of the digital economy: The goods
and services of the IT industry that most directly support the foregoing three segments of the digital
economy include a large fraction of the computer networking subindustry, PC manufacturing, and
some IT consulting firms. (Some analysts characterize the IT industries in more expansive terms and
add communications equipmentincluding broadcastand communications services”
This segmentation includes one of relatively few explicit recognitions that production of ICT goods
and services including telecommunications is part of the digital economy.
The second feature is an implicit acknowledgement of the fuzzy boundaries of the digital economy.
Through use of terms like “highly”, “substantial”, “intensive”, “most directly” and even “critically”,
the Kling & Lamb definition introduces subjectivity and a recognition that there is no rigid boundary
that enables all economic activity to be rigorously placed either inside or outside the scope of
“digital economy”.
Manchester Centre for Development Informatics Working Paper 68
Mesenbourg (2001) similarly segments the digital economy into the production of ICT infrastructure
and the use of ICTs for other economic processes. But in the latter category he starts to look beyond
the spotlighting of e-commerce to also add use of ICTs to conduct other business processes. As to
some degree with Kling & Lamb, this prefigures later and broader definitions that widen out to
include all digitally-enabled economic activity in their definition. These include the simple
definitions noted at the start of this section and others such as DBCDE (2013), Dahlman et al. (2016)
and G20 DETF (2016).
One challenge of the latter wide and simple definitions has been the breadth of economic activities
that currently involve digital technology. Some have therefore followed the lead of Kling & Lamb
(2000) and Mesenbourg (2001) to sub-divide the domain. For instance, Cognizant seeks to
distinguish between just “doing digital” vs. actually “being digital”: simply using digital technologies
vs. placing them at the core of all business processes (Asen & Blechschmidt 2016, Bahl 2016). As
with earlier definitions, though, the dividing line remains subjective.
Table 1: Evolving definitions and concepts of the digital economy
No direct definition but called it the
Age of Networked Intelligence
where it is “not only about the
networking of technology… smart
machines… but about the networking
of humans through technology” that
“combine intelligence, knowledge,
and creativity for breakthroughs in
the creation of wealth and social
Said to have first coined the term “digital
economy. Emphasised that the digital
economy explains the relationship
between the new economy, new
business and new technology, and how
they enable one another.
“…the convergence of computing and
communication technologies in the
Internet and the resulting flow of
information and technology that is
stimulating all of electronic
commerce and vast organisational
Focused on e-commerce and the wider
ramifications of the digital economy
around issues such as privacy,
innovation, standards, and the digital
No explicit definition but identified
four drivers: “Building out the
Internet ... Electronic commerce
among businesses ... Digital delivery
of goods and services ... Retail sale of
tangible goods”.
First clear segmentation of the digital
economy. Emphasised foundations of
digital economy more than economy
“...the recent and still largely
unrealized transformation of all
sectors of the economy by the
computer-enabled digitization of
Emphasised understanding the digital
economy from various angles:
macroeconomics, competition, labour,
organisational change.
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“...includes goods or services whose
development, production, sale, or
provision is critically dependent upon
digital technologies”.
Segmented the digital economy into four
parts: “Highly digital goods and services
... Mixed digital goods and services ... IT-
intensive services of goods production”
and the IT industry.
Defined the digital economy as
“having three primary components”:
- “E-business infrastructure is the
share of total economic infrastructure
used to support electronic business
processes and conduct electronic
- “Electronic business (e-business) is
any process that a business
organization conducts over
computer-mediated networks”
- “Electronic commerce (e-commerce)
is the value of goods and services sold
over computer-mediated networks”.
Focused on how to measure the
emerging phenomena of e-business and
No explicit definition but ranking of
digital economy is based on: “The
quality of a country’s ICT
infrastructure and the ability of its
consumers, businesses and
governments to use ICT to their
Emphasis on the foundations for a digital
economy rather than the digital
economy itself with measures of:
connectivity and technology
infrastructure, business environment,
social and cultural environment, legal
environment, government policy and
vision, and consumer and business
“The digital economy enables and
executes the trade of goods and
services through electronic
commerce on the Internet”.
Main content relates to competition and
regulation in digital markets, with
additional discussion of network effects,
interoperability, and open vs. closed
“The global network of economic and
social activities that are enabled by
digital technology, such as the
internet and mobile networks”.
Key elements seen as readiness,
environment and usage, and focus on
policy measures to enhance the digital
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“ economy based on digital
technologies (sometimes called the
internet economy)”.
Identifies characteristics of digital
economy companies:
innovation through new sources of
finance (venture capital)
importance of intangible assets
new business models based on
network effects
cross-border e-commerce
“The digital economy refers to an
economy based on digital
technologies, although we
increasingly perceive this as
conducting business through markets
based on the internet and the World
Wide Web”.
Key digital economy issues seen as
innovation, rights, cyber-security and
digital literacy.
“A complex structure of several
levels/layers connected with each
other by an almost endless and
always growing number of nodes.
Platforms are stacked on each other
allowing for multiple routes to reach
end-users and making it difficult to
exclude certain players, i.e.
Focus on competition and regulation of
the digital economy.
“The digital economy refers to both
the digital access of goods and
services, and the use of digital
technology to help businesses”.
Focus on policies for regulation and
support of the digital economy.
“...a broad range of economic
activities that include using digitized
information and knowledge as the
key factor of production, modern
information networks as an
important activity space, and the
effective use of information and
communication technology (ICT) as
an important driver of productivity
growth and economic structural
Emphasis on networked and intelligent
ICTs that enable economic activities.
Focus on policy, including cross-national
policy, priorities for the digital economy.
No explicit definition: “less as a
concept and more as a way of doing
things”, but with three attributes:
“creating value at the new frontiers
of the business world, optimizing the
processes that execute a vision of
customer experiences, and building
foundational capabilities that support
the entire structure”.
Covers measurement of digitisation,
under-performance of the region, and
strategies for government and business
to accelerate progress towards a digital
Manchester Centre for Development Informatics Working Paper 68
No explicit definition; instead
differentiation between “doing” and
“being” digital (see also Asen &
Blechschmidt 2016).
Focus on business value and profitability
with advice to move from doing to being
digital: “Businesses need to inject digital
into the very core of what they do and
how they interact and transact with
customers, partners and employees. This
means digitizing processes to super-
charge profitability.”
“The digital economy is the share of
total economic output derived from a
number of broad “digital” inputs.
These digital inputs include digital
skills, digital equipment (hardware,
software and communications
equipment) and the intermediate
digital goods and services used in
production. Such broad measures
reflect the foundations of the digital
Covers how to improve micro- and
macro-economic growth through better
use of digital economy foundations.
“The digital economy is the
worldwide network of economic
activities enabled by information and
communication technologies (ICT). It
can also be defined more simply as an
economy based on digital
Brief review of definitions.
“The digital economy is the
amalgamation of several general
purpose technologies (GPTs) and the
range of economic and social
activities carried out by people over
the Internet and related technologies.
It encompasses the physical
infrastructure that digital
technologies are based on
(broadband lines, routers), the
devices that are used for access
(computers, smartphones), the
applications they power (Google,
Salesforce) and the functionality they
provide (IoT, data analytics, cloud
Emphasises the potential of digital
economies to deliver inclusive and
sustainable growth, but only if key
enablers are put in place.
“An economy which functions
primarily by means of digital
technology, especially electronic
transactions made using the
Definition only.
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“...the economic activity that results
from billions of everyday online
connections among people,
businesses, devices, data, and
processes. The backbone of the
digital economy is hyperconnectivity
which means growing
interconnectedness of people,
organisations, and machines that
results from the Internet, mobile
technology and the internet of things
Sees four main areas of digital
transformation: future of work,
customer experience, digital supply
networks, and Internet of things.
Manchester Centre for Development Informatics Working Paper 68
B2. Conceptualising the Digital Economy
Building from the prior analysis, we can identify three elements relating to conceptualisation of the
digital economy. All definitions give some acknowledgement that digital technologies of some kind
are the foundation for the digital economy. But only a few, in their explanations, identify the
production of these technologies and related foundational services as part of indeed as the core of
the digital economy. We can refer to this core as the digital sector: more often called the “IT
sector” or the “ICT sector”. Though long in the tooth, it is still common to define this using the OECD
definition of the ICT sector first agreed in 1998: “a combination of manufacturing and services
industries that capture, transmit and display data and information electronically” (OECD 2002). This
currently covers ISIC industrial codes (revision 4) 26 (manufacture of computer, electronic and
optical products), 582 (software publishing), 61 (telecommunications), 62 (computer programming,
consultancy and related activities), and 63 (information service activities). This was described and
illustrated (see Figure 2) in more detail by Heeks (2008); albeit the higher-level components go
beyond the OECD definition and overlap into the wider digital economy (see below):
“Goods: production of ICT consumer goods such as computer hardware and digital telecommunications,
plus ICT producer goods: both capital goods (e.g. automated machinery for manufacturing PCs) and
intermediate goods (chips, motherboards, hard disk drives, DVD drives, etc used in computer
Software: design, production, marketing, etc. of packaged and customised software.
Infrastructure: "development and operation of enabling network infrastructure" (Wong 1998:325); both
foundational telecommunications plus value-added networking services.
Services: professional services not covered in other categories such as consulting, training and technical
Retail: sale, re-sale and distribution of ICT goods, software and infrastructure and related services.
Content: production and distribution of data content, including back-office processing and digitisation.”
None of the definitions restricts itself solely to the digital sector but always adds some component of
the “ICT consumption/application” category noted in Figure 2. Thus, the digital economy must be
defined as being broader than simply the digital sector. At their broadest, overall definitions of the
digital economy cover all digitally-enabled economic activity. But this raises a problem: “Increasingly
the digital economy has become intertwined with the traditional economy making differences
between them less clear” (OECD 2013); “The digital economy is increasingly interwoven with the
physical or offline economy making it more and more difficult to clearly delineate the digital
economy” (European Parliament 2015). Not only is there a problem of clarity, there is also a
problem of scope: as more and more services, manufacturing and even primary production activities
rely on ICTs, the digital economy under these definitions increasingly becomes just “the economy”.
Manchester Centre for Development Informatics Working Paper 68
Figure 2: Typology of ICT sub-sectors
Source: Heeks (2008)
To partly skirt this problem, we will not refer to this broad scope covering all economic activity
based on digital technologies as the digital economy but, instead, as the digitalised economy. This
arises from the differentiation between “digitisation”: conversion of data from analogue to digital
form; and “digitalisation”: application of digitisation to organisational and social processes (including
economic activity) (Brennen & Kreiss 2014). This broad-scope definition therefore covers e-business
(ICT-enabled business transactions) and its sub-set, e-commerce (ICT-enabled external business
transactions), algorithmic decision-making in business, use of digitally-automated technologies in
manufacturing and agriculture including Industry 4.0 and precision agriculture, etc.
Here, though, we will seek a narrower-scope definition of the digital economy, based on the notion
of intensive and extensive applications of ICTs (Narasimhan 1983). Intensive applications intensify
that is, improve in some way an existing economic activity. Extensive applications extend the
boundaries of economic activity:
A simple way to understand extensive economic activity is to ask: “has this activity only arisen due to
ICTs?”. If the answer is no – the activity already existed before ICTs then any use of ICTs is intensive.
If the answer is yes the activity only exists because of ICTs then this is extensive (Heeks 2017).
Via this approach, the digital economy would represent all extensive applications of digital
technologies plus the production of those digital technologies. It would include the OECD definition
digital sector, and the broader elements represented in Figure 2 above: digital services, retail and
content activities not covered by the OECD definition and codes. And it would cover some parts of
emergent phenomena the platform economy, the gig economy, the sharing economy where
those could be seen to be new economic activities that did not pre-exist digital technology. For
example, platform-based companies would be included. This is easy to see with firms like Facebook
ICT Consumption/Application
Manchester Centre for Development Informatics Working Paper 68
and Google that are solely digital; a bit less clear with platforms trading tangible goods like Amazon,
eBay or Alibaba; and reaching the blurred edge with firms like Airbnb and Uber. But we would
define the latter as lying within our digital economy definition because they are not accommodation
firms or taxi firms; they are digital platforms and they are built on digital innovations and digital
business models (Accenture 2016).
Based on this and the central notion of extensivity, we therefore define the digital economy as “that
part of economic output derived solely or primarily from digital technologies with a business model
based on digital goods or services”. The definition has a blurred boundary but it is also flexible
enough to incorporate digital and digital business model innovation over time. As Figure 3
summarises, it encompasses both the core digital sector and also the broader range of extensive
digital activity, without claiming that all digitised activity is part of the digital economy.
Figure 3: Scoping the digital economy
Source: Authors
Industry 4.0
Software &
IT consulting
Gig economy
Narrow Scope: Digital Economy
Core: Digital (IT/ICT) Sector
Broad Scope: Digitalised Economy
Sharing economy
Manchester Centre for Development Informatics Working Paper 68
Box 1: Perspectives on the Digital Economy
Analysing the digital economy definitions in Table 1, one can identify a number of different
perspectives reflected:
Resource Perspective: most obviously this rests on a technology perspective with many
definitions identifying the technologies on which the digital economy is founded; but some
include a content perspective that typically relates to the handling of data or information (e.g.
Brynjolfsson & Kahin 2000b), and a human resource perspective that goes further to incorporate
human knowledge or creativity or skills that are enabled by ICTs (e.g. Tapscott 1996).
Process/Flow Perspective: many definitions cover the use of technologies to support particular
business processes such as transactions/commerce (e.g. Kling & Lamb 2000, Mesenbourg 2001),
while a few acknowledge the new flows of data or information that are enabled by ICTs (e.g.
Lane 1999). This would include talking about the changes to processes that are occurring (e.g.
Bahl 2016).
Structural Perspective: may be rather generic in talking about economic transformation (e.g.
Brynjolfsson & Kahin 2000b, G20 DETF 2016) or more specific in identifying the new web-
/network-based structures that emerge as part of the digital economy (e.g. DBCDE 2013,
European Parliament 2015).
Business Model Perspective: lying between the process and structural perspectives, are the few
definitions that bring in the idea of the new business models that are being enabled e.g. those
that mention e-business or e-commerce (e.g. Mesenbourg 2001, European Commission 2013) or
digital platforms (e.g. European Parliament 2015).
Alongside these direct components of definitions, we can identify:
Discourse of Novelty, Urgency, Inevitability: “Don’t blink: the future is rushing straight at us”
(Dean et al. 2012). Within the definitions and their surrounding discussion there is a continuous
sense of novelty and change in relation to the digital economy: new technologies, new
organisational forms (from processes through business models to structures), and implicit within
this new values and norms. Particularly by consulting firms, but also by others, there is a sense
of urgency; of action being needed now to put in place new business strategies and new
government policies. And there is no questioning of the importance and inevitability of the
digital economy’s emergence. The questions are not whether the digital economy will grow or
should be allowed to grow or in what ways it should grow; it is going to grow especially in your
competitor firms and nations and the devil take the hindmost.
Process /
Manchester Centre for Development Informatics Working Paper 68
C. Measuring the Digital Economy
Given the increase in digitally-enabled economic activity and hence its growing economic
importance, measuring the digital economy is an essential process. But it is a flawed process:
Good policy making, tax policy and the allocation of resources require high-quality data. This does not
exist at present in the digital economy, and policy making cannot therefore be reliably expected to
support as much as possible the digital economy” (House of Commons 2016)
There are a number of challenges:
Definition/boundaries: as discussed above, the definitions of “digital economy” are various and
differing. This does not per se make measurement difficult but it makes comparisons difficult.
And definitions with a blurred boundary between the digital economy and the rest of the
economy make measurement difficult (OECD 2014).
Data quality problems: at present, particularly in developing countries, foundational data
problems exist data is absent or of poor quality. This is exacerbated by continuous innovation,
which means data gathering is always behind the curve of technological change (ibid.).
Problems with price: Moore’s Law and its ilk – “my watch has more computing power than the
Apollo 11 moon mission” – mean constantly falling prices for the same amount of ICT power,
storage, etc. And the same may be true for ICT-enabled services, which also see qualitative
changes that price may not reflect, and the availability of free items (think Wikipedia) that
nonetheless add economic value (House of Commons 2016, OECD 2016). Corrections have to be
made to account for this but these are not an exact science (Moulton 2000, OECD 2014, OECD
Digital economy invisibility: many digitally-enabled economic activities do not readily appear as
output. They may be intermediate services between business or between consumers; it may be
difficult to price inputs so making it hard to calculate value-added; and being often virtual, they
are hard to track no least in relation to cross-border digital trade4 and digital consumers-as-
producers (WEF 2015, House of Commons 2016, OECD 2016).
Some argue that as a result of these challenges, the metrics of the digital economy using
conventional economic analysis are “not just unknown, but unknowable” (Sheehy 2016). The
assumed impact of these challenges is that the size of the digital economy is currently “grossly
underestimated” (ibid.). For example, use of Standard Industrial Classification codes showed there
to be 167,000 digital sector companies in the UK in 2012; but direct investigation estimated the true
number to be 60% higher at just under 270,000 (House of Commons 2016; see also ONS 2015).
Sheehy (2016) estimates that if the contribution of the digital economy were to be calculated
differently based on the absolute value delivered, rather than by using GDP-related economic
measures then the digital economy would be a far more important part of the overall economy:
delivering 20% of the total value of the global economy, rather than the current value of around 5%
of global GDP5.
4 Cross-border data flows are >200 terabits per second, and “data flows now exert a larger impact on global
GDP than the flow of goods” (Manyika et al. 2016).
5 As discussed next, this looks similar to the size differentiation between digitalised and digital economies.
Manchester Centre for Development Informatics Working Paper 68
Notwithstanding these challenges, we will review what measurement data has been made available.
C1. Overall Size of the Digital Economy
The bad news is that there are no specific measures of the digital economy as just defined, but the
measures that are available give some sense of overall size. The foundational minimum is set by
measures of the digital (IT/ICT) sector; for example that it represented c.6% of OECD value added in
2012 and 2013 (OECD 2014, OECD 2015) or that it represented c.US$3.5tn or c.4.5% of global GDP in
2015 (Selvan & Kalyanasundaram 2015, Gartner 2016). GDP percentages for developing countries
are likely to be around one-third to one-half of OECD/global figures, based on other data such as
that given below6.
There are cross-cutting measures, which cut across the scopes defined above. One used by various
McKinsey reports is the idea of the “Internet economy”: the contribution to GDP of Internet-enabled
economic activity (e.g. du Rausas et al. 2011)7. This represents a slice across the three economic
scopes represented in Figure 3, excluding some of the digital sector, and excluding non-Internet-
related (e.g. some mobile-related) elements of the digital and digitalised economy. Estimated size of
the Internet economy for 2010 was US$1.7tn or just under 3% of global GDP. A different slice arises
from estimates of the mobile sector, which in Figure 3 terms looks to largely be confined as a sub-set
of the digital sector but with perhaps some inroad into the digital economy. This was estimated by
McKinsey to represent just under 1.5% of global GDP in 2011 (Manyika et al. 2013) and at US$1.1tn
again 1.5% of global GDP in 2015 by GSMA (2016)8. Given the presence of smartphones/mobile
Internet, this will overlap to some extent with the Internet economy estimates.
There are additive measures; for example, adding the size of the platform economy to that of the
digital sector. One estimate gives the “collaborative economy” as US$15bn in 2013: around 0.002%
of global GDP (Petropoulos 2017). An alternative sums the turnover of the top 25 platform firms
worldwide, which gives a total of US$391bn in 2016: around 0.5% of global GDP (WP 2017).
Finally, there are much higher estimates which encompass the digitalised economy. For example,
those suggesting the value of e-commerce in 2013 was US$16.2tn; just over 21% of global GDP
(UNCTAD 2015). And those suggesting the size of the “digital economy” (but defined as per the
digitalised economy above) represented US$19tn or 22.5% of the global economy in 2015
(Knickrehm et al. 2016).
6 See also UNCTAD (2012) which estimates computer software and services to comprise around 1.5% of GDP in
industrialised economies and around 0.5% of GDP in developing countries.
7 Calculated via an expenditure-based approach using a proportion of cost for end-user equipment like PCs (%
time spent online / % all time used); all e-commerce figures; all Internet subscription expenditure; trade
balance based on proportion of trade that is Web-enabled (for OECD estimated at 70% of software and
services plus 40% of hardware/telecom expenditure, but much lower in some developing countries e.g. for
8 Consisting of mobile operators, mobile infrastructure providers, device manufacturing, distributors and
retailers, and content, applications and other services. Note GSMA (2016) claims a further US$2tn impact on
global GDP via improvements in the general economy and productivity improvements.
Manchester Centre for Development Informatics Working Paper 68
Steering between these, we can estimate that the digital economy as defined above represents
around 5% of global GDP, though this will likely grow with growth in platform firms and digital
services9. So the digital economy is huge but still dwarfed by the non-digital economy.
C2. Features of the Digital Economy
Notwithstanding the lack of direct digital economy measures, one can draw other conclusions about
the digital economy from the available data:
i. The digital economy is unevenly distributed. There is uneven distribution between global North
and global South. For example, McKinsey figures estimate the Internet economy in 2010
contributing 3.4% of developed country GDP but only 1.9% of “aspiring country”10 GDP, with the
former contributing 78% and the latter 22% of the overall Internet economy (Manyika & Roxburgh
2011, Gnanasambandam et al. 2012). Figure 4 shows the data for 2012, with the GDP share of the
Internet economy in Africa well below that of other country groupings at just 1.1% (Manyika et al.
2013). Likewise, three-quarters of global e-commerce was accounted for by the US, UK, Japan and
China (UNCTAD 2015).
Figure 4: Size of the Internet economy in Africa
Source: Manyika et al. (2013)
9 For example, the estimate that by 2025 online talent platforms alone will turn over US$2.7tn: some 2% of
global GDP (Manyika et al. 2015).
10 “Aspiring country” does not equate to the typical understanding of global South/developing country since it
includes Russia and some relatively high-income Central/Eastern European and West Asian nations as well as
some higher-income countries of Africa, Asia and Latin America; and it excludes almost all of Africa and much
of Asia.
Manchester Centre for Development Informatics Working Paper 68
There is also uneven inter-regional distribution. For example, the US dominates the global North’s
digital (IT/ICT) sector, taking around one quarter of the global total (ITA 2017). Within the US, this
contributes 7.1% of GDP11 which is well above the OECD average (ibid.). The same applies in the
global South. Using McKinsey’s figures (du Rausas et al. 2011), two-thirds of Internet economy GDP
in aspiring countries came from the four BRICs (see also Figure 4). Digital economy leaders include
India (with more than 7% of GDP estimated to come from the IT sector alone (Nasscom 2016)) and
the Philippines (with more than 7% of GDP estimated to come from the BPO sector alone (Chang et
al. 2016)).
ii. The digital economy is growing faster than overall economies, especially in the global South.
The greater size of the digital economy in the global North means its past impact on overall
economic growth has been larger there. For instance, McKinsey data estimates that the Internet
contributed more than 20% of GDP growth in developed economies during the five years to 2011,
more than 10% in the large emerging BRICs economies, and more than 5% in other aspiring
countries (Manyika & Roxburgh 2011). Looking more broadly World Bank data estimates that ICTs
accounted for 17% of GDP growth in developing countries in the previous ten years but that this
impact was more constrained than in the global North (World Bank 2016).
Digital economy growth rates everywhere are faster than the total economy growth so the digital
economy is growing as a proportion of the overall economy with current growth rates particularly
high in the global South. For example, the Internet economy in the G20 is said to be “growing at
10% a year significantly faster than the overall G20 economy. The growth is even higher in
developing economies, at 15-25% annually” (WEF 2015). Looking at specific or related elements, the
fastest growth of e-commerce is in the global South (UNCTAD 2015), the fastest growth of cross-
border links is in emerging economies (Manyika et al. 2016), and main growth in the mobile sector is
coming from the global South (GSMA 2016).
This pattern of greater-than-global-average growth in the global South looks set to continue. For
example, Accenture (2017) predicts 5% annual growth in the global digital economy to 2020, lifting it
to 25% of global GDP, but future annual growth rates in developing countries are typically cited as
double-digit (e.g. Statista 2017a, Statista 2017b). Growth potential in developing countries is
identified as even greater, such as claims that growing the Internet to the size of the mobile sector in
Africa would lead the Internet economy to form 10% of African GDP by 2025 (Manyika et al. 2013),
or the claim that doubling adoption of ICTs at the base of the economic pyramid would lead to a net
global gain of US$6.3tn in GDP and create 77 million new jobs within a decade (El-Darwiche et al.
2012). Yet there are significant barriers to realising this potential.
iii. The digital economy contributes significantly to employment. The digital (IT/ICT) sector is
estimated to account for around 1% of the workforce in developing countries, and nearly 4% in the
global North; perhaps around 2.5% of the global total (OECD 2014, World Bank 2016). This would
suggest around 3% of the global workforce in the digital economy as per Figure 3’s definition. As
with GDP figures, there are significant exceptions in the global South. For example, around 2m
workers (just under 5% of the workforce) in the Philippines are estimated to be working online, with
11 And nearly 12% of employment, though this may include indirect employment.
Manchester Centre for Development Informatics Working Paper 68
at least half of those working in call centres (Vidaurri 2015, Lund & Manyika 2016)12. And there are
estimated to be just over 3m workers directly employed and a further 7-10m indirectly employed via
the Indian IT sector in 2014 (Heeks 2015), while an estimated 6m in total are employed directly and
indirectly as a result of the Indian Internet economy (Gnanasambandam et al. 2012).
Despite future concerns about automation, the general narrative is of employment creation via the
digital economy. McKinsey data (Nottebohm et al. 2012) claims that, globally, the Internet creates
3.1 jobs for every job that it destroys, with this effect higher in aspiring economies (3.2 created) than
in developed economies (1.6 created); and with digitisation claimed to have created 17m jobs in
emerging economies just between 2009 and 2011 (El-Darwiche et al. 2012). As with many other
figures, there are suggestions that employment statistics for the digital economy are
underestimates. To offer just one example, OECD figures put ICT sector employment at 4.5% of the
UK workforce but more direct estimates put the figure at 11% (House of Commons 2016).
Labour productivity in the digital economy is generally higher than that in the overall economy. For
example, labour productivity was US$90,000 per head in the general economies of the OECD, and
more than US$160,000 per head in the ICT sector (OECD 2014), which fits roughly with the idea of
nearly 4% of employment but more like 6% contribution to GDP/value added. The specific ratio will
depend on the digital economy sub-sector: productivity levels were 160% above those of the total
economy in telecommunications services but only 21% higher in IT services (ibid.)13. The ratio may
be higher in developing countries: for example, in India average labour productivity per worker in
the mid-2010s was around US$10,000 but in the software industry was more than US$37,000 (Heeks
12 In 2013, average monthly wages just within the BPO sector ranged between US$675 and US$1,320: three to
six times higher than the average monthly wage of US$215 (ILO 2014).
13 Mobile industry data reflects the former: employment (17m in 2015) is around 0.6% of the global workforce
but the industry produces 1.5% of global GDP (GSMA 2016).
Manchester Centre for Development Informatics Working Paper 68
D. Summary
Economic and political imperatives are combining with technological innovation to spur growth of
the digital economy, with growth levels particularly high in developing countries. This growth must
be strategised by the private sector, guided by government, and analysed by civil society and
academe. Yet the foundations for these actions are missing with definitions, concepts and measures
of the digital economy currently in rather a mess.
This paper has charted different definitions of the digital economy including their development
over time to provide a three-scope model. The digital (IT/ICT) sector is the core of the digital
economy but the scope of the digital economy is argued to stretch beyond this, encompassing a set
of emerging digital business models. Though included by many digital economy definitions, we
differentiate wider applications of digital technologies in existing businesses; seeing these as within
scope of the broader “digitalised economy”.
Measuring the digital economy faces challenges of fuzzy boundaries, poor data quality, pricing
problems, and invisibility of much digital activity. Acknowledging many caveats, we see the digital
economy as defined here probably making up around 5% of global GDP and 3% of global
employment. Overall measures hide significant unevenness: the global North has had the lion’s
share of the digital economy to date, but growth rates are fastest in the global South. Potential
growth rates in the global South if barriers could be overcome are even higher. Separate
investigation will be required of opportunities, barriers, and good-practice interventions that are
required to realise this potential of the digital economy to deliver significant development impacts.
Manchester Centre for Development Informatics Working Paper 68
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... The business model of the digital economy is based on digital goods and services, and its outputs are derived primarily or solely from digital technologies (Bukht & Heeks, 2017). The domain of the digital economy claims both the core digital sector and the broader range of extensive digital activity, but it does not claim all digitized activities in the market. ...
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The impact of digital transformation on the shape of business operations around the world cannot be understated. Yet, the Islamic digital economy era remains in its infancy, and the challenges that it faces are still left unanswered. Nonetheless, Halal entrepreneurs are presented with significant innovative opportu-nities related to the digital economy. Halal entrepreneurship is an important subject of business research since culture and religion play a significant role in creating business relationships. Cultural entrepreneurship has become a means to use culture and arts for bringing a societal change. This chapter identifies some new opportu-nities in the digital economy that can be exploited by Halal entrepreneurs. These ventures include the internet of things (IoT), three-dimensional (3D) printing, cloud computing, automation, robotics and artificial intelligence, data analytics, digital platforms, and blockchain technologies. This chapter contributes theoretically and practically to Halal entrepreneurship and the Islamic digital economy. The oppor-tunities identified in this chapter can help Halal entrepreneurs and policy makers to launch products and services and policies to propel the growth of the Islamic digital economy.
The need for digital transformation of agro-industrial complex of the Russian Federation and the land improvement industry is directly connected with the processes that ensure the creation of digital products and the use of digitized technologies in the industry. Thus, according to the analytical center of the Ministry of Agriculture of the Russian Federation, the influence of information technologies on the cost of grain production was revealed. It showed that investments in IT products for the industry connected with the operation of irrigation systems give a reduction in costs by approximately 16%. Such a result will undoubtedly contribute to an increase in labor productivity in the industry, and, consequently, increase the competitiveness and financial stability of the firms. As the subject of the study, the authors identified the conditions of digital transformation in the land improvement industry of the agro-industrial complex of the Russian Federation. The aim of the paper was to identify favorable opportunities and counteracting factors in the development of the digitalization process of land improvement industry, as well as to identify the strong and weak characteristics of the firms as participants in this process. In the article, such research methods as statistical, situational, logical and SWOT analyses were used. As the results of the study, the authors made the conclusion that allows us to emphasize the features of the digital space of land improvement industry. The conclusions made it possible to obtain an objective assessment of current conditions of digitalization of land improvement, plan and predict both positive and negative trends of digital transformation for firms in land improvement, and mobilize more reasonably a variety of resources necessary for adaptation and digital breakthrough in the land improvement industry.
The International Scientific Conference on Innovations in Digital Economy: SPbPU IDE 2021 was held at Peter the Great St. Petersburg Polytechnic University (SPbPU), St. Petersburg, Russia during October 22–23, 2021. This conference was conducted jointly by the Graduate School of Industrial Economics (GSIE) at SPbPU and the Center for Sustainable Infrastructure Development (CSID) at the Universitas Indonesia (UI). The spread of COVID-19 has been among the main factors affecting the global economy and has boosted the development of Industry 4.0 and the digital economy. On the one hand, COVID-19 has had severe negative effects on people, companies, and national economies. On the other hand, it has boosted the spread of digital technologies, which helped to overcome these effects and minimize damage. It has also supported the development of Industry 4.0 and the digital economy, since certain types of technologies have become more commonly used among a larger number of people and companies. Therefore, the aim of the conference was to discuss recent contributions to the understanding of innovations in the digital economy and its consequences for modern economies. We believe that the community of our conference is key to the dissemination of the most recent advances and promotion of new international collaborations. Professionals from Russia, Indonesia, Italy, France, the UK, Spain, and other countries took part in IDE 2021. The conference started with an opening ceremony, and a welcome speech was given by the First Vice-Rector for Scientific and Organizational Activities and Corresponding Member of the Russian Academy of Sciences, Vitalyi Sergeev; Acting Vice-Rector, Yuriy Klochkov; Director of the Institute of Industrial Management, Economics and Trade, Vladimir Schepinin; Dean of Faculty of Engineering of the UI, Ir Hendri Dwi Saptioratri Budiono; Executive Director of the Center for Sustainable Infrastructure Development of the UI, Mohammed Ali Berawi; Director of the Graduate School of Industrial Economics, Dmitrii Rodionov; and the Head of Development and Strategic Planning of SPbPU, Maria Vrublevskaia. Yuriy Klochkov noted that SPbPU responds quickly to changes in science and everyday life, which allows it to develop rapidly, and the Institute of Industrial Management, Economics and Trade is a provider of such growth. After the opening ceremony, a plenary sessionwas held atwhich RoyWoodhead from Sheffield Hallam University (UK) spoke about the possibilities of, and approaches to, the implementation of the ‘smart city’ concept, Vincenzo Bianco from the University of Genoa (Italy) spoke about the development of PV power in Italy, Emma Juaneda Ayensa from La Rioja University (Spain) shared an omnichannel strategy for creating added value for users, and Jessica Lichy from IDRAC Business School (France) discussed the dark side of technological innovation for knowledge transfer. During the conference, a master class was held by the editor of the IJTECH journal, Mohammed Ali Berawi, where the professor talked about strategies for writing articles for international journals and gave useful advice to authors on the publication process. Natalya Berestovskaya, a specialist in the promotion of business products from CJSC Interfax-North-West, held a master class on identifying and assessing risks when working with legal entities using the SPARK-Interfax system. During the two days of the conference, the participants spoke at six different sessions, participated in master classes, shared their experience with colleagues, and discussed issues related to innovations in the digital economy, including digitalization in education, the ‘smart city’ and ‘smart home’ concepts, the cryptocurrency market, eco-activism, risks of implementing infrastructure projects, etc. The conference received a total of 153 submissions. All submitted papers underwent a four-stage review process. In the first stage, all papers were evaluated and reviewed by the conference or Program Committee co-chairs. In the second stage, papers were evaluated and reviewed by at least two reviewers or a Program Committee member. In the third stage, we conducted technical reviews and checked papers for plagiarism, mastery of the English language, and overall structure. This resulted in a pool of high-quality papers presenting the best practices and scientific results within the scope of the conference topics. Out of these papers, 23 were accepted for publication in CCIS after additional review and significant extension. For the first section, ‘Economic efficiency and social consequences of digital innovation implementation’, three papers were selected. The first paper in this section, written by Maxim Kuznetsov, Alexander Gorovoy, and Dmitrii Rodionov, discusses a 120-year timeline of web innovation cycle development. The authors describe attributes and improvements of web development which can help strategize digitization initiatives among entrepreneurs, start-ups, investors, and governments. The second paper in this section, written by Elena Korchagina, Larisa Desfonteines, Samrat Ray, and Natalia Strekalova, describes the possibilities of using modern digital technologies for the transport system related to local environmental conditions and demographic characteristics. The authors note that the transport system could become the basis for improving people’s quality of life if it undergoes digital development. The third paper in this section, written by Anuphat Thirakulwanich and Sudaporn Sawmong, studies how user-generated content on YouTube relates to customers’ purchase decisions in regard to smartphones. The research also shows that perceived usefulness and perceived credibility have a positive effect on behavioral intention to purchase smartphones. For the second section, ‘Regional innovation systems and clusters as drivers of economic growth during the Fourth Industrial Revolution’, three papers were selected. The first paper in this section, written by Ksenia Pereverzeva, Denis Tsvetkov, Konstantin Petrov, and Svetlana Gutman, aims to justify the selection of a region with the greatest potential for the bioenergy sector. The authors suggest developing a region’s bioenergy sector in conjunction with digital technology, namely by introducing ‘smart’ greenhouses, applying digital technology to maintain the most favorable conditions for animals, and using the automated collection of biofuel. The second paper in this section, written by Mariana Petrova, Petya Popova, Veselin Popov, Krasimir Shishmanov, and Kremena Marinova, identifies the main characteristics, types, and components of the digital ecosystem concept and describes the business model to create value through this kind of system. In conclusion, the authors point out that a digital ecosystem should be related to the size and scope of a business organization because it will improve networks and gradually replace the supply chain model. The third paper in this section, written by Angi Skhvediani, Tatiana Kudryavtseva, Valeriia Iakovleva, and Igor Kuhotkin, is devoted to the issue of developing a database of clusters on Russian territory and a system for the visualization of statistical information for cluster policy decision-making. The results of this research paper show what the development of software tools will allow in terms of bridging the gap in the development of the analytical and predictive information systems of the regional economy. For the third section, ‘Industrial, service and agricultural digitalization’, ten papers were selected. The first paper in this section, written by Lo Thi Hong Van, Liudmila A. Guzikova, and An Thinh Nguyen, explores the role of e-commerce development in sustainable economic growth through the example of the Socialist Republic of Vietnam. This article includes the authors’ approach to assessing the contribution of e-commerce to the sustainable growth of GDP and the classification of e-commerce development policies based on level of regional development. In the second paper in this section, written by Mustika Sari, Mohammed Ali Berawi, Teuku Yuri Zagloel, Louferinio Royanto Amatkasmin, and Bambang Susantono, the authors explore the data preparation of energy-efficient and healthy buildings to be utilized in a machine learning (ML) model that can accurately predict the building variables. The outcome of this study shows that the predictive ML model could help decision-makers quantitatively predict healthy building variables to an adequate level of accuracy. The third paper in this section, written by Marina Bolsunovskaya, Nina Osipenko, Svetlana Shirokova, and Aleksei Gintciak, develops an innovative project model for digital wearable devices. This model illustrates the entire process of data transmission from a ‘smart’ device to a synchronized a mobile application and offers solutions to improve the transmission process and data protection. The fourth paper in this section, written by Tatiana Bogdanova, Elena Rytova, and Ekaterina Krasilnikova, proposes an algorithm for choosing alternative technologies to implement a particular business process. The final assessment of technology implementation is carried out on the basis of a three-block pattern: assessment of technology risks, assessment of suppliers, and assessment of the financial and economic efficiency of the project. The fifth paper in this section, written by Alexander Babkin, Vadim Tronin, Anton Safiullin, and Alexander Alexandrov, explores the transformation of software project management in Industry 4.0. The authors note that a combined or hybrid model of software project management, combining traditional and agile methodologies, seems to be more sustainable. The sixth paper in this section, written by Ekaterina Abushova, Ekaterina Burova, Andrei Stepanchuk, and Svetlana Suloeva, develops an express method for assessing the current level of industrial enterprise digitalization. A feature of the proposed technique is to assess the level of digitalization of each of the key aspects of a modern competitive production enterprise and obtain a comprehensive indicator that allows further conclusions. The seventh paper in this section, written by Maksim Pasholikov, Leonid Vinogradov, Tatiana Leonova, Vasily Burylov, and Eitiram Mamedov, tests the methods of multi-criteria optimization of quality criteria in the field of commercial water treatment. The proposed trained neural network model can become the basis for the development of a common methodology to create the optimal vector of business activity quality in any sector of the economy. The eighth paper in this section, written by Igor Ilin, Oksana Iliashenko, Victoria Iliashenko, and Sofia Kalyazina, proposes a method of integral assessment of the results of the implementation of an intelligent data analysis platform. This method makes it possible to assess the feasibility of the goals set for the development of a digital company and to form goals for further strategic development. The ninth paper in this section, written by Anastasia Levina, Alisa Dubgorn, Alexandra Borremans, and Evgenia Kseshinski, reveals a reference model for the use of information technology in terms of the need to simplify the management of geographically distributed organizations and improve the efficiency of medical services. This article discusses various ways in which modern healthcare information technologies can be used to improve the quality of direct care, increase benefits for commercial organizations, reduce costs for government enterprises, and improve user experience for patients. The tenth paper in this section, written by Galina Silkina, Natalia Alekseeva, Svetlana Shevchenko, and Lyudmila Pshebel’skaya, defines the digital management tools and information trends of the new industrialization. The results of this research substantiate the use of industrial knowledge graphs as a semantic basis for decision-making. For the fourth section, ‘Response of an educational system and labor market to the digital-driven changes in the economic system’, four papers were selected. The first paper in this section, written by Viktoriya Degtyareva, Svetlana Lyapina, and Valentina Tarasova, discusses the problems of developing new educational program for universities and issues that need to be addressed by coordinating with various institutions in the system in the context of the spread of digitalization. The results of the work determine the following directions for the further development of educational program: normative and methodological development, the use of external expertise, and the expansion of cooperation with employers. The second paper in this section, written by Svetlana Evseeva, Oksana Evseeva, and Preeti Rawat, studies the modern features of the external environment of an organization and its impact on employee development. The results of this paper allow companies to design employee development program based on BANI (brittle, anxious, nonlinear, and incomprehensible) world characteristics. The third paper in this section, written by Aleksandr Kozlov, Alina Kankovskaya, Anna Teslya, and Artem Ivashchenko, researches regional labor digital potential through local organizations. The authors differentiate regions in terms of the intensity of use of digital skills of the population by employers. The fourth paper in this section, written by Marine Gurgenidze Nana Makaradze, Tatia Nakashidze-Makharadze, Anna Karmanova, Zhanna Nikiforova, and Victoria Sheleiko, identifies the strengths and weaknesses of distance training, evaluates its results, and defines ways to increase efficiency. For the fifth section, ‘Digital transformation trends in the government and financial sector’, three papers were selected. The first paper in this section, written by Nikolay Lomakin, Aleksandr Rybanov, Anastasiya Kulachinskaya, Elena Goncharova, Uranchimeg Tudevdagva, and Yaroslav Repin, hypothesizes that an AI system can be used to obtain a forecast of the share of overdue loans in a bank’s portfolio. As a result of this project, the perceptron program was developed to predict the dynamics of the share of overdue loans in the portfolio of a commercial bank, which was formed on the Deductor platform. The second paper in this section, written by Olga Chemeris, Victoria Tinyakova, Yaroslav Lavrinenko, and Xingyuan Sun, uses the Global Innovation Index as a tool to measure the level of innovation in a country’s economy, determined in the current environment by digital transformation, as well as to identify the factors influencing it. The study reveals a strong correlation between the amount of public spending per student and the level of innovation in the economy. The third paper in this section, written by Svetlana Pupentsova, Alexandr Demin, Alina Kirilyuk, and Victoria Pupentsova, studies the development of tools for participatory design in the formation of urban public spaces and analyzes participatory design methods. We want to thank our keynote speakers, panellists, and authors, who contributed to the conference and made this event possible by submitting and later reviewing their work according to the comments provided by the reviewers. We are also grateful to the members of the Program Committee for providing valuable and profound reviews. We hope that the conference will continue to be an annual event at which scientists and practitioners can share recent developments in the sphere of the digital economy.
The author believes that the countries of North Africa, with a much differentiated level of socio- economic and digital development, already have certain opportunities for digital development, the need for such development and the creation of digital potential, including in the field of digital trade. However, in our opinion, the countries of the region currently lack a strategic understanding of specific industry tasks in the field of digitalization. It is important to strengthen the presence of the Russian Federation in the digital segment of the region, especially in key segments of the economy. According to the author, the prerequisites for strengthening cooperation in this segment really exist, in particular, they are predetermined by both a fairly active digitalization in the Russian Federation and the growth of Russian-North African trade in the commodity segment and in the service sector based on the growing interest of the parties in the further development of bilateral cooperation, taking into account the growth of global uncertainty.
The article is devoted to the main directions of regulation of the digital economy in the Republic of Azerbaijan. In recent years, growth rates in the field of digital economy have been observed in all countries of the world. Analysis shows that in international rating reports the Republic of Azerbaijan has been annually increasing its economic position in terms of economic development indicators. All these processes are positively influenced by factors such as the implementation of an effective economic policy in the country, the development of a modern digital economy, and the stimulation of attracting foreign investment. The development of the digital economy in globalizing world is considered one of the main priorities of developed countries. However, as in other regional countries, there are certain problems in the development of the digital economy, the introduction of ICT in all economic spheres, and the export of modern digital technologies in the Republic of Azerbaijan.That is why it is important to regulate the digital economy in Azerbaijan, taking into account international experience. The continuous reforms carried out in the Azerbaijan on the basis of international experience in the field of digital economy are considered effective. The level of development of the sphere of digitalization in the Republic of Azerbaijan, the output of products (services) in the ICT sector and the volume of investments in fixed assets is not high compared to previous years. That is why Azerbaijan’s position in international reports on the digital economy is lower than of other countries in the region. The article analyzed the measures taken in the field of digital economy in the Republic of Azerbaijan, as well as the existing problems in this area. The analysis shows that economic measures towards the development of the digital economy should be continued.
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I document a significant deindustrialization trend in recent decades that goes considerably beyond the advanced, post-industrial economies. The hump-shaped relationship between industrialization (measured by employment or output shares) and incomes has shifted downwards and moved closer to the origin. This means countries are running out of industrialization opportunities sooner and at much lower levels of income compared to the experience of early industrializers. Asian countries and manufactures exporters have been largely insulated from those trends, while Latin American countries have been especially hard hit. Advanced economies have lost considerable employment (especially of the low-skill type), but they have done surprisingly well in terms of manufacturing output shares at constant prices. While these trends are not very recent, the evidence suggests both globalization and labor-saving technological progress in manufacturing have been behind these developments. The paper briefly considers some of the economic and political implications of these trends.
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This chapter critically reviews literature on e-entrepreneurship in order to position future empirical research with a focus on emerging markets (The terms “emerging economies”, “emerging countries”, or “developing economies” are used interchangeably and refer to the list of countries named as such by the International Monetary Fund (World Economic Outlook. Washington, DC: International Monetary Fund, 2013)) in general and in Latin America in particular. The term ‘e-entrepreneurship’ has been used to describe the creation of different e-businesses by both start-ups and established companies. Thus, the concept of Digital Start-up (DS) as a specific unit of study of e-entrepreneurship is presented. DSs are defined as start-ups born on the internet to sell only digital products/services exclusively online. The emergence of this new breed of enterprises is opening doors for entrepreneurs to enter new markets with an explosive potential for growth, as demonstrated by the cases of Facebook, Twitter, Instagram and others. This phenomenon acted as a catalyst for a new entrepreneurial ecosystem in emerging markets supported by both private and public entities. However, there are still very limited signs of success outside of the United States, Israel, and Europe. The literature reveals that the lifecycle and ecosystems of DSs have been extensively researched in developed countries; however, there is a relative paucity in the context of emerging economies. E-entrepreneurship research is grouped into six categories: e-business models, digital economy, entrepreneurship, business ecosystems, innovation, and e-entrepreneurship. Relevant theoretical frameworks and their application to DSs are explored. The chapter concludes that gaps remain in the literature on e-entrepreneurship in the context of emerging economies and questions for future research are presented.
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Despite her small size and late industrialization, Singapore has managed to capture a significant share of the global information industry over the last three decades. This paper analyzed the structure and growth dynamics of Singapore's information industries using an analytical framework that integrates the four key components of an information economy: ICT goods industry, content industry, network infrastructure, and informatization. The paper identifies four generic stages in the development path of Singapore's information economy and highlights policy implications for other small, open economies.
Half-Title Page Series Page Title Page Copyright Page Dedication Page Table of Contents Series Editors’ Preface Acknowledgements Abbreviations Introduction
This study investigates the development of the digital economy policy in Thailand. The researcher describes the importance of digital technologies for the competitiveness development of the country. In addition, the researcher analyzes the components and provides a roadmap of the digital economy policy in Thailand. Main problems and challenges of the policy are identified. The data were gathered and analyzed from secondary sources. The findings can be used to guide the implementation of the digital economy in Thailand and other developing economies.