Foster, C.G., 2019. Conceptual framework for assessing value in the digital economy in developing countries, Background paper for the UNCTAD Digital Economy Report 2019, UNCTAD, Geneva, Switzerland.
Discussion paper | UNCTAD 2019 Digital economy report which this paper contributed to
As the digital economy expands into developing countries it is becoming important to assess the impacts it is having. This is especially important with the discussion of not only positive impacts emerging in the digital economy but also disbenefits to workers, to firms and potentially more broadly to economies. The concept of value in the digital economy is one way to better assess these impacts, by providing a perspective on the impacts, across different components of the economy and over the short and the longer term.
This paper sets out to expand on this idea of value in the digital economy. Given that the digital economy is often defined imprecisely, we first explore the definitions of the digital economy to provide a clear scope for analysis. With a particular emphasis on developing countries, we then highlight some of the varied impacts of the digital economy and how these pose challenges for assessing positive and more problematic outcomes, particularly when both types of outcomes may occur together.
Responding to this challenge, we develop a conceptual framework of value highlighting four key elements that are important to explore, the division of value, governance of value, upgrading, and creation vs capture of value that can be useful in assessing value in the digital economy. Through an analysis of three key trends in developing countries around platformization, e-commerce and digitalization we use this framework to assess how the digital economy is changing value. Specifically, we highlight new forms of value being created, particularly around platforms and data.