China’s Digital Economy: Opportunities and Risks
IMF Working Papers, January 17, 2019
Source details
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- China’s Digital Economy: Opportunities and Risks
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Bibliographic details
- Authors: Longmei Zhang, Sally Chen
- Published: January 17, 2019
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781484389706.001
Summary
- China’s digital economy has expanded rapidly in recent years.
- Average digitalization of the economy remains lower than in advanced economies, but digitalization is already high in certain regions and sectors, in particular e-commerce and fintech, and costal regions.
- Digital transformation has boosted productivity growth, with varying impact on employment across sectors.
- Going forward, digitalization will continue to reshape the Chinese economy by improving efficiency and softening though not reversing the downward trend of potential growth as the economy matures.
- The government should play a vital role in maximizing the benefits of digitalization while minimizing related risks, such as potential labor disruption, privacy infringement, emerging oligopolies, and financial risks.
Key findings and observations
- Rapid expansion of the digital economy across China, with concentration in:
- e-commerce
- fintech
- coastal regions
- Productivity effects:
- Digital transformation has boosted productivity growth.
- Impact on employment varies across sectors.
- Structural implications:
- Digitalization improves efficiency.
- Digitalization will soften, though not reverse, the downward trend of potential growth as the economy matures.
- Risks identified:
- Potential labor disruption
- Privacy infringement
- Emerging oligopolies
- Financial risks
Policy recommendations and roles for government
- Maximize benefits of digitalization while minimizing related risks through government action:
- Address potential labor market disruption.
- Protect privacy and manage data-sharing concerns.
- Mitigate the rise of emerging oligopolies and concentrated market structures.
- Monitor and contain financial risks associated with fintech and digital financial services.
Publication metadata and identifiers
- Authors: Longmei Zhang, Sally Chen
- Date: January 17, 2019
- Series: IMF Working Paper No. 2019/016
- Volume: 2019
- Issue: 016
- Pages: 24
- DOI: https://doi.org/10.5089/9781484389706.001
- Stock No: WPIEA2019016
- ISBN: 9781484389706
- ISSN: 1018-5941
- Subject keywords: Digital economy, Digitalization, Economic sectors, Employment, Financial services, Fintech, Information technology in revenue administration, Labor, Revenue administration, Technology
- Additional keywords: aggregate employment growth, China, data sharing, Digital economy, Digitalization, Employment, Financial stability, Fintech, fintech company, fintech industry, firm, firms in the U.S., Global, ICT company, industry, Information technology in revenue administration, market structure, money market fund, pay, payment, Productivity, supply chain, third-party payment platform, third-party payment system, venture capital, WP
Source: Longmei Zhang, and Sally Chen. "China’s Digital Economy: Opportunities and Risks", IMF Working Papers 2019, 016 (2019), DOI: https://doi.org/10.5089/9781484389706.001.
Content in this bundle
- China’s Digital Economy: Opportunities and Risks, WP/19/16, January 2019