It's An E World And That's Not Bad

It costs $22.50 to buy "The Emerging Digital Economy" directly from the Commerce Dept., but you can download it from the Internet for free. That pretty much sums up the substance of the report, which shows that electronic commerce is changing the nature of the U.S. economy and generating much of its growth. Information technologies are bringing down inflation, raising productivity, hiking employment, and boosting wages, according to the study. If anyone still needed proof of the rise of a New Economy, here it is.

Only last month, the University of Texas released a study sponsored by Cisco Systems Inc. reporting that E-commerce generated $301 billion in revenues last year, matching the auto industry but growing much faster and employing far more people. Most of it comes from hardware spending to build the Net, but an increasing amount is actual business conducted among companies and between them and consumers.

The advent of the New Economy doesn't change everything. Business cycles will continue, albeit in forms we perhaps have yet to discover. The verities of the marketplace won't disappear. But business models, stock valuations, and growth potential appear changed in some fundamental and positive sense. It's no small thing.