OECD Digital Economy Outlook

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The evolution of the digital technology ecosystem is driving economic and societal changes, with the information and communication technology (ICT) sector at its core proving dynamic and resilient in the face of economic headwinds. As digital technologies like artificial intelligence, virtual reality and next generation networks permeate our lives and the economy, it is critical to unleash innovation responsibly, ensure that the benefits of these technologies are widely shared, and reduce the risks technological advances can pose to well-being and society.

ICT sector

ICT sector growth outpaces the total economy

New estimates find that the information and communication technology (ICT) sectors of OECD countries have significantly outperformed the growth of the broader economy over the past decade. The ICT sector grew about three times faster than the total economy across OECD countries between 2013-23, with an average growth rate of 7.6% in 2023.

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Artificial intelligence

AI actors must collaborate to unleash innovation responsibly and ensure its benefits are widely shared

The future of AI may yield tremendous benefits, including enhanced productivity gains, accelerated scientific progress, and solutions to help address climate change. However, AI advances also raise risks, including those related to trust, fairness, privacy and safety. Building a shared understanding of the key opportunities and risks will be critical to ensure AI is trustworthy and used to benefit humanity and the planet.

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Tech diffusion

Technological innovations are advancing, but uptake is uneven

While technologies such as cloud computing and 5G have diffused widely, adoption of data-dependent technologies like AI remains low and concentrated in certain sectors and among larger firms, suggesting that there is much scope for AI and its productivity-enhancing benefits to expand into the broader economy. In the future, the integration of terrestrial and non-terrestrial wireless technologies will expand the connectivity ecosystem and make it more resilient.

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Note: LEO: Low Earth Orbit • MEO: Medium Earth Orbit • GEO: Geostationary Orbit

Source: OECD elaboration based on multiple sources, including Ofcom, the European Space Agency and GSMA.

Virtual reality

Immersive technologies enable extraordinary experiences, but safety is key

Body tracking facilitates “presence” and sets virtual reality apart from other immersive environments, but the data it generates raise privacy risks. Just 20 minutes in VR generates almost 2 million unique data points of body language. Safety in VR must also be carefully considered, especially for children and in moving vehicles.

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Mental health

Negativity online is on the rise

Since 2017, the share of young people reporting difficulties in everyday functioning and feeling unhappy because of social media use increased by 49%, with the share of girls increasing more than twice as much as boys. Cyberbullying is also becoming more common among young people, with girls experiencing higher rates than boys on average.

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What should governments do?

1. Estimate the size of the “digital economy” to better target digital policies

The need to expand the evidence base increases as digital transformation intensifies, and its societal and economic impact widens. It is crucial to use traditional and non-traditional techniques to improve the timely measurement of the digitalisation of the economy to support policy makers in designing and implementing public policies fit for the digital age.

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2. Promote AI governance rooted in values-based principles

As generative AI and foundation models enable increasing AI generality, countries’ national AI policies and strategies must respond to the growing demand for AI compute capacity, address AI’s environmental impacts and mitigate risks related to privacy, intellectual property rights and information integrity.

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3. Address emerging policy and regulatory challenges in the connectivity ecosystem

Anticipate the regulatory and policy challenges posed by an evolving connectivity ecosystem, as terrestrial wireless networks increasingly integrate with non-terrestrial solutions like drones, airplanes, and satellites.

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4. Foster the uptake of technologies to boost innovation and bridge digital divides

Access to digital technologies and the ability to use them effectively are critical not only for digital innovation, but also for equal opportunity and inclusion. Investing in skills and creating a level playing field among firms for access to key inputs, including data, are key in this respect.

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5. Shape a positive immersive future to protect privacy and safety

New approaches beyond traditional consent-based models will be needed to protect privacy in virtual reality given that body tracking data is essential to creating such experiences. VR mental and physical safety must also be carefully considered from the outset, especially for children and in moving vehicles, and safety by design can play an important role in this respect.

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6. Raise awareness and address the risks of digital environments for mental health

As people spend an increasing amount of time on line, and digital environments become more immersive and “real”, public policies should target negative behaviours in digital environments and how to manage their impacts, especially for those most at risk, including girls.

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OECD Digital Economy Outlook 2024 (Volume 1)

iLibrary doi: 10.1787/a1689dc5-en

The OECD Digital Economy Outlook 2024, Volume 1: Embracing the Technology Frontier provides new insights on key technologies that underpin the digital technology ecosystem and their impacts. Using big data and machine-learning techniques, Volume 1 provides new estimates of the growth rate of the ecosystem’s core – the information and communications technology (ICT) sector.

> Discover OECD work on Digital Economy

> Going Digital Toolkit