Presentation by
Felix Ritchie
Professor of
Applied
Economics
Director,
Bristol Centre
for Economics
and Finance
26th january 2017
Operating a business in
the digital economy
Challenges, opportunities and skills
Contents
• Big changes
o Markets
o Employment
o Skills
• Little or no change
o geography
o basic good business
Markets – who gains?
• Businesses that can exploit information
• initially, at least…
Markets – who gains?
• Businesses that can exploit information
• Businesses that can exploit behaviour
Markets – who gains?
• Businesses that can exploit information
• Businesses that can exploit behaviour
• Businesses servicing the ‘long tail’
Markets – who gains?
• Businesses that can exploit information
• Businesses that can exploit behaviour
• Businesses servicing the ‘long tail’
• In the long run: consumers/purchasers
Employment
• Are computers replacing humans?
• In the long run, no
• Recent conventional wisdom:
machines…
o replace ‘repetitive’ workers
o augment ‘creative’ workers
• True in the future…?
Employment
• Are computers replacing humans?
• Opportunities for flexible employment
o or risks, for employer and employee?
o in the long term, integration seems to have the advantage
Employment
• Are computers replacing humans?
• Opportunities for flexible employment
• How trustworthy are your staff?
Skills
• Education levels increasing across the world
o is this education well targeted?
o good news: training older workers now less of a problem
o bad news: we don’t know how young people learn
Skills
• Education levels increasing across the world
o is this education well targeted?
• Do we still need to instill ‘knowledge’?
o are analytical skills more important?
What isn’t changing?
• Geography matters, even for digital goods
What isn’t changing?
• Geography matters, even for digital goods
o businesses still cluster
̶
trading
networking
employing
training
reputation
̶
ie production advantages
̶
̶
̶
̶
o Becoming even more important as market
advantages disappear?
What isn’t changing?
• Geography matters, even for digital goods
• Basic business rules
o even digital products need a market
What isn’t changing?
• Geography matters, even for digital goods
• Basic business rules
• Surprisingly little, conceptually
o but digital economy changes scale and speed of business
Summary
• Reasonable idea of who the commercial gainers and
losers are, in short and long term
o so far
• Lot more uncertainty about employment and business
structure
• Uncertainty about future skills but likely to value
o adaptability skills
o analytical skills