The Digital Economy’s Rise: Transformation, Opportunities, and Strategic Directions

DOI: https://doi.org/10.62517/jse.202511411

Author(s)

Shengchang Zhang1,*, Qianyu Zhang2, Fred Zhang3

Affiliation(s)

1School of Business Administration, Baise University, Baise, Guangxi, China 2Derun Campus of Shandong Experimental High School, Jinan, Shandong, China 3PMS, Pleasanton, California, USA *Corresponding Author.

Abstract

The digital economy, powered by information and communication technologies (ICTs), has transformed global economic structures, reshaped traditional industries, and created opportunities for innovation and entrepreneurship. This paper explores the development trajectory of the digital economy, analyzing its impact on productivity, labor markets, industrial upgrading, and global trade. This paper will point out the effects of ICTs, including computer hardware, software, and all the technical means of transporting data between interfaces. Drawing on recent empirical studies and global frameworks, this paper examine key enablers such as data, digital infrastructure, platforms, and digital literacy, examining specific experiences of users and what could be taught and improved. We will also review the economic benefits and potential drawbacks of the digital economy, evaluating the purpose and potential improvements the market has to offer. We also identify emerging challenges, including digital inequality, cybersecurity, platform monopolies, and the need for international coordination mechanisms, which, if left unaddressed, can lead to further harm that affects social security and reliance the topic at hand. The paper concludes by proposing strategic directions for stakeholders to promote inclusive, secure, and sustainable digital economic growth, enabling broad access to digital market benefits.

Keywords

Digital Economy; ICTs; Economic Transformation; Labor Market; Industrial Upgrading

References

[1]Bukht, R., & Heeks, R. Defining, conceptualizing and measuring the digital economy. The Development Informatics Working Paper Series, 2017, 68, 1–24. [2]Brynjolfsson, E, & McAfee, A. The second machine age: Work, progress, and prosperity in a time of brilliant technologies. MIT Press, 2014. [3]Forbes. Amazon Web Services hits $24 billion run rate. Forbes, 2015, October 21. [4]World Bank. Digital connectivity gaps in Sub-Saharan Africa. World Bank Reports, 2023, 1–30. [5]Bettiol, M., Capestro, M., Di Maria, E., & Micelli, S. Is this time different? How Industry 4.0 affects firms’ labor productivity. Small Business Economics, 61(3), 2023, 123–145. [6]Srnicek, N. Platform capitalism. Polity Press, 2017. [7]Tapscott, D. Blockchain revolution: How the technology behind Bitcoin is changing money, business, and the world. Penguin Random House, 2015. [8]Adhikari, P. Leveraging telemedicine for enhanced maternal and perinatal care in rural Nepal. Annals of Medicine & Surgery, 2024, 86, 6598–6601. [9]OECD, OECD digital economy outlook 2020. OECD Publishing, 2020. [10]GSMA. The mobile gender gap report 2023. GSMA, 2023. [11]McKinsey & Company. The economic potential of generative AI: The next productivity frontier. McKinsey Global Institute Report, 2024, 1–40. [12]European Union. Digital Markets Act. European Commission, 2023. [13]Mann, M., & Daly, A. (Big) data and the North-in-South: Australia’s informational imperialism and digital colonialism. Critical Criminology, 2019, 27(2), 195–212. [14]Bartley, K. The exponential growth of data: Challenges and opportunities. Rivery Insights, 2024, January 15. [15]OECD, Digital infrastructure for inclusive growth. OECD Digital Economy Papers, 2023, 1–25. [16]Wigginton, C. How 5G enables smart cities. Forbes, 2023, June 15. [17]Chicago Booth School of Business. Second annual antitrust and competition conference report. University of Chicago Press, 2023. [18]U.S. Government Publishing Office. Investigation of competition in digital markets. U.S. Congressional Report, 2023, 1–449. [19]Center for Strategic and International Studies. Digital skills for inclusive societies. CSIS Reports, 2023, 1–20. [20]Brynjolfsson, E., Li, D., & Raymond, L. R. The economic impact of generative AI. MIT Sloan School of Management Working Paper, 2023, 1–35.