Digital Economy and Sustainable Economic Development: Insights from Developing Nations
DOI:
https://doi.org/10.69935/mr7t5y38Keywords:
Digital Economy, Sustainable Economic Development, Developing Nations, Digital Entrepreneurship, SMEs, InnovationAbstract
This review paper examines the relationship between the digital economy and sustainable economic development, with a specific focus on developing nations. It synthesizes existing literature to explore how digital technologies such as artificial intelligence, big data, digital platforms, and fintech contribute to economic growth, social inclusion, and environmental sustainability. The study highlights that the digital economy enhances productivity, fosters innovation, and expands market access, while also improving access to financial services, education, and public services. It further emphasizes the critical role of entrepreneurship and small and medium-sized enterprises (SMEs) as key drivers in translating digital transformation into sustainable outcomes through digital ecosystems and platform-based business models. The review identifies key enabling factors, including digital infrastructure, supportive policies, institutional quality, innovation, and human capital, which collectively determine the effectiveness of digitalization in achieving sustainability goals. However, it also recognizes significant challenges such as the digital divide, limited access to finance, weak institutional frameworks, cybersecurity risks, and increasing inequality, which may hinder inclusive development. By integrating insights across economic, social, and environmental dimensions, the study provides a comprehensive understanding of the digital–sustainability nexus. The findings suggest that a balanced and inclusive approach, supported by strong governance and strategic policy interventions, is essential to harness the full potential of the digital economy for achieving sustainable and inclusive development in developing countries.
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