Questions & Answers: Economics - Economy and Modern Technology

Explain e-commerce.
The growth of the Internet has brought many changes to our society, not the least of which is the ways we do business. Where supply channels used to have to move in certain ways, many of these channels are now bypassed as e-commerce makes it possible for nearly any individual to set up a direct market to consumers, as well as direct interaction with suppliers. Competition is fierce. In many instances e-commerce can provide nearly instantaneous gratification, with a wide variety of products. Whoever provides the best product most quickly often rises to the top of a marketplace.
How this added element to the marketplace will affect the economy in the near and not-so-near future remains to be seen. Many industries are still struggling with the best ways to adapt to the rapid, continuous changes.

Explain cybernomics.
Related to the knowledge economy is what has been dubbed “cybernomics,” or economics driven by e-commerce and other computer-based markets and products. Marketing has changed drastically with the growth of cyber communication, allowing suppliers to connect one-on-one with their customers.

Other issues coming to the fore regarding cybernomics include:
· Secure online trade
· Intellectual property rights
· Rights to privacy
· Bringing developing nations into the fold

As these issues are debated and new laws and policies developed, the face of many industries continues to undergo drastic change. Many of the old ways of doing business no longer work, leaving industries scrambling to function profitably within the new system.

Explain the knowledge economy.
The knowledge economy is a growing sector in the economy of developed countries, and includes the trade and development of:
· Data
· Intellectual property
· Technology, especially in the area of communications
Knowledge as a resource is steadily becoming more and more important. What is now being called the Information Age may prove to bring about changes in life and culture as significant as those brought on by the Agricultural and Industrial Revolutions.