The process of transnational integration emerging especially in the late 80s, in terms of its effects on the economy, is called the new economy. Besides the advantages of the new economy to the traditional or, in another word, old economy, the disad-vantages it also brings with it are also a subject of the discussion. Even though most of the studies taking place in the literature emphasize the innovative viewpoint that the new economy brings to the economic system, some parts of the studies deal with disadvantages, especially the effects of increasing employment and creating developedness differences.
The term ‘new economy’ expresses an innovation process which also incor-porates the phenomenon of digitalization. The most important aspect of the new economy is that it reveals the changes and transformations in the economic struc-ture and systems. The contributions made by these changes and the transforma-tions to the system emerge, depending on the sustainability of macroeconomic policies. The contributions of interest are summarized by Bernard L. Weinstein as follows (Cited by Norton, 2000: 2):
– An economy that grows without the apparent threat of recession.
– An economy that continues to expand without a pick up in inflation.
– An economy constantly restructuring itself for greater efficiency and produc-tivity.
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– An economy replenishing and revitalizing itself through new technology and capital investment.
– An economy that functions without excessive debt, either public or private.
– An economy that maintains a balanced budget.
– An economy that is increasingly globalized and export driven.
Another important element of the new economy is digitalization and, depend-ing on this, the gradual deependepend-ing of digital division (Akyazı & Kalça, 2009: 9).
Digitalization expresses that in the social, cultural, political, and especially eco-nomic areas, data processing technologies are adapted to systematic processes and a transformation. Between the concept of progression in information and communications technologies and digitalization, there are some differences in terms of the depth of concepts. From this aspect, the information economy and the digital economy do not have the same meaning and the information economy forms the main cornerstone of the tendencies of the digital economy. As a matter of fact, economic digitalization actualizes through information and communica-tion technologies.
On the other hand, digitalization tendencies, together with it, trigger a much higher increase in the developedness difference between societies or different sections in terms of technology, called digital division. While some parts of the world produce technology, an important part of it consumes technology. The sector consuming technology is divided into those adapting the technology they buy for their own production processes without producing it and those only using technology. Without making any contribution or without using technol-ogy as an input, between the consuming sector and others, a serious difference is naturally revealed. Thus, from the social, cultural, and, of course, economic point of view, countries that can follow technological developments become considerably advantageous compared to those that are not able to follow these developments.
As a natural result of the Internet and information age, it is possible to put the features of this new economic order in order as follows: digitalization as in-formation, virtuality, becoming molecular, integration, merging, innovativeness, removal of borders, globalization, the utility of speed and time, and incompliance.
Digitalization gradually becoming widespread underlies the features differentiat-ing the new economic system from the old economy.
In particular, economy policies, under the name of the new economy, that emerged in the economic course made many positive changes obligatory. The most basic focus of these changes emerged in the roles of economic decision units.
That is, the new economic process resulted in the roles of many actors such as
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non-governmental organizations, especially the triad of government, individuals, and firms, to change. In the new economy, there are a number of features such as that markets are very dynamic, that competition is at a global level, that firm organizations turn into a sort of network, that production is flexible, that innova-tion and informainnova-tion is a main element in growth, that there is lifelong learning, and that arrangements are carried out by market instruments and in more flexible way (Akyazı & Kalça, 2009: 10).
The countries proceeding and wanting to proceed along the way of economic development are first of all obliged to integrate into the new global system in terms of the development stage. The most basic requirement and the role of the integra-tion concerned are undertaken by the government. Economic policies that are to be followed by governments in the direction of the targets of welfare maximiza-tion moved away from the approach of the intervening or entrepreneur state and the approach of the adjudicator state and the national state only regulating the game rule in economy policy, and the limited and international state undertak-ing of some missions in the market economy has stood out (Karaçor, 2012: 35).
On the other hand, government policies giving direction to other actors focus on removing regional unbalances and turning the national innovation system into a culture. Digitalization, in other words, innovative culture in the development area, is the most important determinant of the competitive power of countries in the global plane. On other hand, digitalization also creates a gap in terms of the developedness level. Economies, which cannot adapt to the innovation process of global world, cannot complete their stages in terms of their welfare level and must import technology. In the globalizing world, the role and effects of govern-ment also make it necessary for firms to change. Firms, for the sake of being able to increase their competitive power, adopt to implement the new production and governance systems as their main strategy and, thus, place targets on increasing their profit shares. On the other hand, the process concerned also modifies the role of the individual actor. Together with the new economy, the demand for a qualified labor force and, thus, for the potential and actual labor supply to become qualified and included in the employment process.
Macroeconomic results of the new economy emerge with the productivity increase observed at the level of productivity in the economy. Together with pro-ductivity increase, an increase in total product occurs and, using the same amount of production factors, more output can be obtained. When it is dealt with from this viewpoint, it is obvious that in the economic system, digitalization affects productivity and growth in a positive direction. In addition, the new economy also affects many macro variables such as foreign trade, income distribution, cyclical
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fluctuations, competitive advantage, etc. The subject that will be discussed here is its effect on employment.