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The reality is that while the benefits of new technologies are often exaggerated at first, they often turn out to exceed initial expectations in the moderate-to-long term. This is exactly what has happened with the digital revolution. The digital economy is more than fulfilling its original promise, with digital adoption rates exceeding even the most optimistic forecasts of the late 1990s. The integration of IT into virtually all aspects of the economy and society is creating a digitally-enabled economy that is responsible for generating the lion’s share of economic growth and prosperity.

Notwithstanding the centrality of IT to economic growth, there have been surprisingly few attempts to catalogue what is known about IT’s impacts on the economy. This report attempts to do just that by collecting, organizing, and surveying studies and examples of IT’s impact in five key areas: 1) productivity; 2) employment; 3) more efficient markets; 4) higher quality goods and services; and 5) innovation and new products and services. (…)

1) Give the Digital Economy Its Due: Economic policymakers need to view IT issues not just as narrow IT policy, but as the centerpiece of economic policy. This means putting
issues of digital transformation at the front and center of economic policy.
2) Actively Encourage Digital Innovation and Transformation of Economic Sectors: The private sector will drive much of digital transformation, but government can play a supportive role. Government should support research in emerging IT areas. IT should also use a wide array of policy levers, including tax, regulatory, and procurement policies, to spur greater IT innovation and transformation, particularly in key sectors like health care, education, transportation, and others influenced by public policy. Moreover, government should lead by example by leveraging their own IT efforts to achieve more effective and productive public sector management and administration.
3) Use the Tax Code to Spur IT Investment: Investment is how IT innovations are diffused throughout the economy. Because IT seems have a much larger impact on productivity, tax policies should focus on spurring additional investment in newer generations of IT.
4) Encourage Universal Digital Literacy and Digital Technology Adoption: Ensuring that societies take full advantage of the IT revolution will require that the large majority of citizens participate in the digital economy. nNational governments need to work in partnership with the for-profit, non-profit, and state and local government sectors
to help citizens use and access technology.
5) Do No Harm: Making digital transformation the center of economic policy means not just supporting IT, just as importantly it means avoiding harming the digital engine
of growth. All too often well-intentioned policymakers consider laws and regulations that would slow digital transformation.