Policy and Regulatory Issues with Digital Businesses
Advances in digital technology are expanding the boundaries of firms. Digital platform firms, which leverage a "platform" to create value through facilitating exchanges between two or more interdependent groups, are the new disrupters in...
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| Format: | Working Paper |
| Language: | English |
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World Bank, Washington, DC
2019
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| Online Access: | http://documents.worldbank.org/curated/en/675241563969185669/Policy-and-Regulatory-Issues-with-Digital-Businesses http://hdl.handle.net/10986/32132 |
| Summary: | Advances in digital technology are
expanding the boundaries of firms. Digital platform firms,
which leverage a "platform" to create value
through facilitating exchanges between two or more
interdependent groups, are the new disrupters in the market.
They exhibit distinct features such as scale without mass,
positive network effects, accumulation of tremendous data,
and a convoluted value creation process with user
participation. Meanwhile, they bring more opportunities to
traditional businesses by closely connecting suppliers and
customers and reducing transaction frictions. Such a
changing business landscape calls for adaptive policies and
regulations. This policy paper lays out the key policy and
regulatory issues around digital businesses. Competition
laws need to be revisited to address the winner-take-all
tendency of digital platform businesses. Tax systems should
also be updated to close the loopholes available to digital
platform businesses so that they pay their fair share to
society. This paper also provides the first analysis of the
World Bank's Digital Business Indicators initiative,
which collects information on the existence and quality of
regulations in broadband connectivity, digital payment, data
privacy and security, as well as logistics, in 21 pilot
countries. It aims to explore the possibilities for
developing the regulatory and policy indicators that
governments can work with to promote the digital economy. |
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