The Relationship between Digital Economy and Traditional Economy

The connection between digital economy and traditional economy is that digital economy is based on traditional economy.

Brief introduction of digital economy:

Digital economy is the main economic form after agricultural economy and industrial economy. It is a new economic form with data resources as the key element, modern information network as the main carrier, and information and communication technology integration and digital transformation of all factors as the important driving forces to promote fairness and efficiency.

With its rapid development, wide radiation range and deep influence, the digital economy is promoting profound changes in production methods, lifestyles and governance methods, and has become a key force in reorganizing global factor resources, reshaping the global economic pattern and changing the global competition pattern.

Dominant rule:

The first law is Metcalfe's law: the value of a network is equal to the square of its number of nodes. Therefore, the more computers connected to the internet, the greater the value of each computer, and the "value-added" increases exponentially.

The second law is Moore's law: the processing capacity of computer silicon chips doubles every 18 months, while the price drops by half.

The third law is davidow's law: the first generation of products entering the market can automatically gain 50% market share, so any enterprise must be the first in this industry to eliminate its own products. In fact, davidow's law embodies the Matthew effect in the network economy. These three laws determine that the digital economy has the following basic characteristics.

Characteristics of digital economy:

1, speed

First of all, the Internet broke through the traditional national and regional boundaries, was integrated by the network, closely linked the whole world, and turned the earth into a "village". Secondly, it breaks through the time limit, so that people's information transmission and economic exchanges can be carried out in a smaller time span.

Third, the digital economy is a speed economy. Modern information network can transmit information at the speed of light, and the digital economy collects, processes and applies information at a near real-time speed, which greatly accelerates the pace.

2, high permeability

The rapid development of information technology and network technology, with high penetration function, makes the information service industry rapidly expand to the primary and secondary industries, blurs the boundaries between the three industries, and there is a trend of the integration of the primary, secondary and tertiary industries.

3. Self-inflation

The value of digital economy is equal to the square of the number of network nodes, which shows that the benefits generated and brought by the network will increase exponentially with the increase of network users. In the digital economy, due to people's psychological reaction and behavioral inertia, under certain conditions, once the advantages or disadvantages appear and reach a certain level, it will lead to continuous intensification and self-reinforcement.

There is a monopoly situation of "the strong are stronger and the weak are weaker" and "the winner takes all".