UNVEILING THE DIGITAL ECONOMY: HOW DIGITIZATION TRANSFORMS ECONOMIC STRUCTURES
Giorgi Abashidze
E-mail: giorgi.abashidze@bsu.edu.ge
PhD student Batumi Shota Rustaveli State University. Assistant of Batumi Navigation Teaching University
Batumi,Georgia
https://orcid.org/0000-0002-3233-6890
Abstract: One of the most significant processes currently underway in the modern economic system is the digital transformation, which results in the digitization of all economic sectors and creates the digital economy. This represents the current stage of economic development that affected all areas of human life and changed the way the economy functions and the way people live. The production processes, organizational relationships, distribution networks, marketing strategies, customer communication forms, and the way in which customers get goods and services have all undergone substantial change as a result of digital transformation. Consequently, the economic system is shifting from traditional markets to interconnected networks, from traditional consumers to active prosumer, from ownership-based models to access-based models, and from a consumer-driven economy to a sustainable economy (Rifkin, 2015).
It should be mentioned that unlike traditional industries, which lack access to digital technologies, digital business and entrepreneurship can raise the rate of economic growth and create jobs in a short period of time. The digital economy has risen 2.5 times faster than the global GDP over the last 16 years (Huawei and Oxford Economics, 2017). Today, we are living in the process of the digital revolution, or the fourth industrial revolution, which has put a strong demand on individual countries to start digital transformation. This is critically important for small countries that are not rich in natural resources.
As a result, it's critical to evaluate the current stage of digital business growth, trends in the emergence of digital business models and entrepreneurial initiatives, as well as the difficulties associated with the digitization of traditional industries.
The study highlights the benefits of digital entrepreneurship and business over traditional ones. The stages of traditional businesses' digital transition are discussed, along with the models of digital business and entrepreneurship that are currently in use.
Keywords: Digital Economy, Society 5.0, Technological Revolution, Transformation
JEL classification: O3, L86.
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