The digital economy does not automatically generate a "trickle effect"

2023-06-19

In nature, the digital economy is a carrier rather than an end, and the Digital transformation of the economy is a process rather than an end. The development of digital economy, as a means of improving and sharing productivity, undertakes the goal of promoting Common prosperity in high-quality development. Only by establishing such a functional positioning and fully reflecting the new development concept, can the digital economy achieve sustained and healthy development. Correspondingly, in the construction of a basic institutional arrangement for coordinating primary distribution, redistribution, and third distribution, the digital economy should and can make its due contribution. The development of the digital economy does not automatically generate a "trickle effect" of sharing results. Only under the premise of full integration and connection can productivity progress in various industries be driven. Both theory and practice indicate that initial allocation is the fundamental field that determines productivity improvement and sharing. The reasonable allocation of production factors and the reasonable incentives for the owners of production factors are both generated in the field of initial distribution. Sharing productivity achievements requires an increase in productivity as a prerequisite. Productivity is essentially the efficiency of resource allocation, and the basic way to improve productivity is through the continuous reconfiguration of production factors. The digital economy can take advantage of its most prominent features, which are its good connectivity function, driving the continuous extension of the industrial chain, as well as the continuous expansion of resource allocation space, and promoting the continuous improvement of productivity. Initial distribution is also a key area for sharing productivity achievements, but the emergence of this function is not natural. There is no trickle economy where market mechanisms can automatically solve income distribution, and there is also a natural "big trade-off" between efficiency and fairness. Research has shown that the different manifestations of income inequality between countries are not only due to the degree of redistribution, but also to the differences in policy orientation and institutional arrangements in the field of initial distribution. Therefore, in order to fully achieve productivity sharing in the digital economy, and thereby achieve the goals of creating more and higher quality job opportunities, increasing labor remuneration, and narrowing income disparities, regulations and policies need to be deliberately implemented. The development of the digital economy also relies on relevant institutional arrangements in the field of redistribution. The role of the digital economy in improving productivity mainly comes from the "Schumpeter mechanism", and its effectiveness depends on institutional arrangements in the field of redistribution. Schumpeter believes that innovation is the process in which entrepreneurs recombine production factors in the creative destruction process of survival of the fittest. In this process, the pace of productivity improvement is not going hand in hand, and the effectiveness of productivity improvement is even more distinct. The research of the OECD shows that there is significant heterogeneity among industries and enterprises in the adoption of digital technology or Digital transformation, which forms a huge difference in productivity performance. Robert Solow, the winner of the Nobel Memorial Prize in Economic Sciences, once pointed out in a short article that people can see the advent of the computer age everywhere, but they can't see the improvement of productivity in statistics. This sentence reveals a practical problem that people are struggling to solve, which is known as the "Solow productivity paradox" and has sparked widespread discussion. Obviously, this paradox also applies to digital technology and the digital economy, that is, why technology has been widely applied

Edit:luxiongfeng    Responsible editor:zhaoxiaoli

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