Advantages and disadvantages of the digital economy

The digital economy is all economic processes taking place with the use of computing and digital technologies. For the first time, the term "Digital Economy" appeared not so long ago, in 1995, when Nicholas Negroponte (American computer scientist) first voiced this concept.

The main components of the digital economy (DE or e-economy) are: Internet banking, e-commerce, online advertising, electronic payments and electronic access to public services.

The main features of the digital economy are how it changes the perception about the structure of a business, the receipt of information, goods and services by consumers. In order to understand how the electronic economy is implemented directly in commercial activity, we can consider the following examples:

• Uber is the largest taxi company in the world, in which there is not a single vehicle;
• Facebook is the most famous media owner that does not create content;
• Alibaba is the most expensive retailer that does not have a single product;
• Airbnb is the largest non-property landlord in the world.

 Thanks to DE, a lot of new ideas appear. Technologies themselves are not as important as the opportunities they provide. Consider the main advantages and disadvantages of the digital economy below.

Advantages of the digital economy:

• The development of information technology ensures that a lot of work can be done through the Internet. Therefore, the "web" will never lose its relevance.
• The growth of commerce. Over the past decade, it has been observed that companies using new technologies in sales and marketing have grown and prospered.
• The digital economy makes it possible to simplify the processes of buying and selling and the marketing process.
• Speed and convenience. Internet banking has cleared queues at banks. People are gradually moving to online platforms and other areas: medicine, insurance and education.
• Reducing cash payments and using payment systems brings the economy out of the shadows, makes it more transparent and (ideally) prevents corruption.
• Reducing poverty; improving the availability and quality of medical services; reducing the cost of education, etc.

However, there are also negative consequences of scientific progress. 

Disadvantages of the digital economy:

• The more automated actions in business, the fewer personnel are required, so soon representatives of many professions will simply not find a job.
• There are not enough professionals in the digital economy who could work effectively and train new specialists.

The pros and cons of the digital economy are incomparable, and soon, probably, there will be no negative sides at all. After all, gradually, every year and even every day, the digital economy is increasingly being introduced into everyday life; with an increase in population and resource mobilization, the digital economy affects all aspects of life: education, healthcare, Internet banking, etc. But since the growth of digital technologies significantly affects the entire economy as a whole, we can confidently assume that the digital economy is the road to the future!