Publication: A Spiky Digital Business Landscape: What Can Developing Countries Do?

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Zhu, Tingting Juni
Grinsted, Philip
Song, Hangyul
Velamuri, Malathi
Digital technologies hold the promise of bridging wealth gaps through innovation-driven growth, but the “winners-take-most” dynamic of digital business models calls into question the net growth effect and the global footprint of this sector. Digital transformation is driven by a set of digital technologies that have led to a rapid and steep decline in the costs of data storage, computation, and transmission. These technologies hold promise for bridging the wealth gap between nations by allowing developing countries to catch up with generations of previous technologies. At the same time, characteristics inherent to these technologies have the potential to result in a “winner-takes-most” dynamic, by creating market entry barriers and leading to high levels of concentration and potential market dominance. For the first time, this report provides novel evidence of the characteristics of digital business and markets in 190 countries. The report defines digital businesses as digital solution providers that develop and manufacture digital technology products or digital services; a subset of these can also use platform-based and/or data-intensive network effect business models. The report draws on the World Bank’s newly assembled firm-level database of 200,000 digital businesses in 190 countries, to provide unique evidence on the current global digital business landscape.
Zhu, Tingting Juni; Grinsted, Philip; Song, Hangyul; Velamuri, Malathi. 2022. A Spiky Digital Business Landscape: What Can Developing Countries Do?. © World Bank, Washington, DC. License: CC BY 3.0 IGO.
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