The Influence of the Digital Economy onto Social Relations Transformation

Keywords: digital innovations, digital economy, social relations, digital transformation, information society, public administration, microeconomics, macroeconomics, sustainability

Abstract

The article explores the influence of the digital economy on the transformation of social relations. Using a systematic approach, an axiological method, methods of analysis and synthesis, a logical method of reproduction of scientific knowledge of the development of social relations, aggregation of empirical data, the author found out that the development of digital technologies significantly affects the transformation of almost all components of social relations. The research results indicate that the digital economy is becoming a key component of digital transformation, which is determined mainly by economic processes and phenomena arising from the use of digital technologies at all stages of social reproduction, which gradually acquire a socio-economic dimension. This is accompanied by a slow abandonment of outdated technologies, the maintenance of which can be costly to the socio-economic system. There is also, the slow transformation of social ideas, values, norms, traditions and ideals, which forms the basis of the cultural and civilizational experience of society.
A number of discovered advantages and opportunities provided by digital transformation are presented. However, the primary component of the digital transformation, which should lead to radical changes for the economy and various other social spheres, will not be so much the creation and use of digital technologies as a fundamental rethinking of the goals of society’s development, norms of behavior and ethical values of interpersonal relationships.
The most expected consequences of digital transformation for society are related precisely to «transformation» as a deep, consistent restructuring of social processes. Today, digital transformation is penetrating all spheres of society at different rates, and these processes will only accelerate in the future. This becomes a certain driver of development, which ensures the identification and creation of new digital models of society, and can become a factor in the long-term cooperation of various groups of society for the sake of general well-being and common benefit. But the digital transformation of the socio-economic system at any level is a complex and lengthy process with long-term returns. It requires strategy, revision of societal models and processes, professional management, new infrastructure, new software, optimization of service mix, effective implementation mechanisms, training programs and reliable ongoing support.
The spread of digital technologies in the economy and various social areas brings significant advantages, but also has potential threats and risks in various directions, which are highlighted in our research both from the point of view of micro- and macroeconomic approaches, and from the point of view of public administration.
Prevention of the negative consequences of the use of digital technologies should include a system of measures capable of ensuring transparent rules and control over the collection, storage and analysis of large volumes of data about people’s personal lives, eliminating the risk of abuse and restrictions on personal freedom. It is important to prevent a situation where all social processes can become completely dependent on digital technologies and the Internet to such a large extent that it limits personal freedom, privacy and opportunities. And this is not only a possible loss of privacy due to monitoring of Internet activities, personal freedom due to control over information, but also the formation of psychological dependence on digital devices and services, the spread of digital autism and the «empty» hyperinformation environment.
It is shown that the growth of digitalization increases the risks associated with the need to organize a powerful cyber security system. Data leaks, hacking attacks, and other cyber threats can have serious negative consequences for both personal freedom and privacy, as well as for ensuring national security based on the principles of protecting the public interest.
The exploration of the influence of the digital economy onto social relations transformation showed that, in addition to focusing on increasing efficiency in various aspects, it is necessary to focus on other important things – increasing the protection of rights and freedoms, ensuring social welfare, improving the level of health care, increasing the level of security, protection national economic interests, providing wide access to quality education and culture, etc. For this purpose, the responsible, socially beneficial activity of public authorities, public organizations, political parties, and human rights organizations must be ensured, as well as active participation of citizens in the political and public life of society must be established.

Downloads

Download data is not yet available.

Author Biographies

Mykola Kovalenko, V. N. Karazin Kharkiv National University, 4 Svobody Sq, Kharkiv, 61022, Ukraine

Doctor of Science in Public Administration, Professor,
Professor of Economic Policy and Management Department,
Education and Research Institute of Public Administration,
V. N. Karazin Kharkiv National University, 4 Svobody Sq., Kharkiv, 61022, Ukraine

Maksym Sikalo, Director of LLC Vetprom, Kharkiv, Ukraine

PhD in public administration, Director of LLC Vetprom, Kharkiv, Ukraine

References

Voinarenko, M.P., & Skorobogata, L.V. (2015). Network tools for capitalization of information and intellectual potential and innovations. Bulletin of the Khmelnytskyi National University. Economic sciences. 3. 3. 18–24 [in Ukrainian]

Dunayev, I., & Kovalenko, M. (2022). New traces of regulation of information platforms and a platform-based economy for the new public good. Pressing Problems of Public Administration, 2(61), 6-24. Retrieved from: https://doi.org/10.26565/1684-8489-2022-2-01 [in Ukrainian] (accessed 11 September 2023).

Zhukova, L.M. (2017). Digital economy as an object of state regulation. Economic Bulletin of the Zaporizhzhya State Engineering Academy. 5(1). 7–11. Retrieved from: http://nbuv.gov.ua/UJRN/evzdia_2017_5%281%29__3 [in Ukrainian] (accessed 11 September 2023).

Kit, L.Z. (2014). Evolution of the network economy. Bulletin of the Khmelnytskyi National University. Economic sciences. 3. 2. 187–194 [in Ukrainian]

Kovalenko, M., & Dunayev, I. (2023). Components of Public Policy in the Conditions of Implementation of the Mobilization Model of Economic Development. Theory and Practice of Public Administration, 1(76), 7-25. Retrieved from: https://doi.org/10.26565/1727-6667-2023-1-01 [in Ukrainian] (accessed 11 September 2023).

Kolyadenko, S.V. (2016) Digital economy: prerequisites and stages of formation in Ukraine and in the world. Economy. Finances. Management: topical issues of science and practice. 6. 105–112. Retrieved from: http://nbuv.gov.ua/UJRN/efmapnp_2016_6_11 (date of application: 27.11.2023) [in Ukrainian] (accessed 11 September 2023).

Kraus, N.M., Holoborodko, O.P., & Kraus, K.M. (2018). Digital economy: trends and perspectives of avant-garde nature of development. Efficient economy. 1. Retrieved from: http://nbuv.gov.ua/UJRN/efek_2018_1_8 (date of application: 11.09.2023). [in Ukrainian](accessed 11 September 2023).

Kruglov, V. (2021). Public policy of labor market transformation: challenges of the digital age. Scientific Herald. Series: Public Administration, 1(7) 140–161. Retrieved from: https://doi.org/10.32689/2618-0065-2021-1(7)-140-161/ [in Ukrainian] (accessed 11 September 2023).

Orwell, J. (2023) 1984. Kyiv: Zhupansky Publishing House. 320 [in Ukrainian].

Piketty, T. (2016) Capital in the 21st century. Kyiv: Nash Format. 696 [in Ukrainian].

Stepanenko V. (2021). Without a permanent place of work and money. What is precarity and how it undermines the world. Our Kyiv. 21.01. Retrieved from: https://nashkiev.ua/business/bez-postiynogo-mistsya-roboti-y-groshey-scho-take-prekarnist-i-yak-vona-pidrivae-svit [in Ukrainian] (accessed 11 September 2023).

Digital economy: trends, risks and social determinants. (2020). The project manager, the author of the report is Olha Pyschulina. Razumkov Center, 2020. “Zapovit” Publishing House. Kyiv. October. Retrieved from: https://2020_digitalization PDF (razumkov.org.ua). (date of application: 27.11.2023) [in Ukrainian] (accessed 11 September 2023).

Digital dividends. Review (2016). World Development Report. World Bank. Retrieved from: https://openknowledge.worldbank.org/bitstream/handle/10986/23347/210671RuSum.pdf. [in English] (accessed 11 September 2023).

Chmeruk, H.G. (2019). Digital economy as a separate sector of the national economy of the state. Scientific Bulletin of the Uzhhorod National University. Series: International economic relations and world economy. 27(2). 92–97. Retrieved from: http://nbuv.gov.ua/UJRN/Nvuumevcg_2019_27(2)__18 [in Ukrainian] (date of application: 11.09.2023).

Being Digital (1995). Fundamental article by Nicholas Negroponte on the digital economy for 1995, part 2. Philtech Initiative. Retrieved from: https://sudonull.com/post/60026-Being-Digital-Nikolos-Negropontes-fundamental-article-on-the-digital-economy-of-1995-part-2-Philtech [in English] (accessed 11 September 2023).

Forum Digital (2019). Business in Ukraine is ready for a digital breakthrough. Delo.ua.

02. Retrieved from: https://delo.ua/ business/forum-digital-biznes-v-ukraine-gotov-k-cifrovom-349977 [in Ukrainian] (accessed 11 September 2023).

Gartner (2023). Information Technology Glossary. Retrieved from: https://www.gartner.com/en/information-technology/glossary/digitization [in English] (accessed

September 2023).

Global wealth report. (2019). Credit Suisse. Retrieved from: https://worldwealthreport.com/resources/world-wealth-report-2019 [in English] (accessed 11 September 2023).

Jean Baudrillard. (1970). La Societe de consommation. Ses mythes, ses structures. Editions Denoël, Paris [in France].

Kelly, K. (1998). New Rules for the New Economy: 10 radical strategies for a connected world. New York: Viking. 224 [in English].

Key Issues for Digital Transformation in the G20. Report Prepared for a Joint G20 German Presidency. – OECD, 12 January 2017. Retrieved from: https://key-issues-for-digital-transformation-in-the-g20.pdf [in German] (accessed 11 September 2023).

Kovalenko, M., Ziuz, D., Smihunova, O., & Bondar, N. (2020). Implementation of state economic policy under corporatocracy: Financial and credit aspect. Public Policy and Administration, T 19, Nr. 3/2020, Vol. 19, Nr. 3, 36-47. Retrieved from: http://dx.doi.org/10.5755/j01.ppaa.19.3.26842 [in English] (accessed 11 September 2023).

OECD Digital Economy Outlook (2017). OECD. Retrieved from: https://espas.secure.europarl.europa.eu/orbis/sites/default/files/generated/document/en/9317011e.pdf [in English] (accessed 27 November 2023).

Oxford Advanced Learner’s Dictionary (2023). Retrieved from: https://www.oxfordlearnersdictionaries.com/definition/english/digital-economy [in English] (accessed

September 2023).

Rouse, M. (2016). Digital Economy. Techtarget, Newton, MA,. Retrieved from: http://searchcio.techtarget.com/defi nition/digital-economy [in English] (accessed 11 September 2023).

Sharma, S. (2018). Digital Economy. ITU-BTRC Asia-Pacific Regulators’ Roundtable. SESSION 5. 07.08.2018. Retrieved from: https://www.itu.int/en/ITU-D/Regional-Presence/AsiaPacific/Pages/Events/2018/rr2018/home.aspx [in English] (accessed 11 September 2023).

Tapscott D. (1994). The Digital Economy: Promise and Peril in the Age of Networked Intelligence. Paperback, 1994. 368 [in English].

WalkMe. Digital Adoption Platform. Glossary (2023). Retrieved from: https://www.walkme.com/glossary/digitalization/ [in English] (accessed 11 September 2023).

Published
2023-11-27
How to Cite
Kovalenko, M., & Sikalo, M. (2023). The Influence of the Digital Economy onto Social Relations Transformation. Theory and Practice of Public Administration, 2(77), 83-108. https://doi.org/10.26565/1727-6667-2023-2-06
Section
State Regulation of Economic and Social Development Processes