Urenio Watch Watch: Smart Growth

Digital Globalization: The new era of global flows

Digital1This report produced by Mckinsey Global Institute (MGI) aims at providing a detailed analysis regarding the evolution of global data flows and the ways in which they affect people and economic growth. Within the report an extended econometric analysis is used, based on a sophisticated methodology, providing evidence for the economic value of that kind of global flows.

Digitization changes the economics of globalization in several ways. As digital platforms become global in scope, they are driving down the cost of cross-border communications and transactions, allowing businesses to connect with customers and suppliers in any country.


Global flows support growth by raising productivity and creating more efficient markets with truly global scale. But not all countries are making the most of this potential.

Some policy issues regarding the use of global in order to increase productivity within countries are also discussed in the report. These policy recommendations include suggestions such as:

  • Thinking strategically about the role your country can play.
  • Addressing policy and administrative barriers that hinder global flows.
  • Addressing dislocations.
  • Investing in human capital.
  • Building the necessary infrastructure and closing the digital divide.
  • Creating a strong business and institutional environment.
  • Protecting data privacy while maintaining an open Internet.
  • Making cybersecurity a top priority.


Moreover, the ways in which digital globalization has helped to eliminate barriers that once prevented small and medium sized enterprises (SMEs), entrepreneurs, and ordinary citizens from making cross-border connections are also part of the analysis. The fact that even in developing countries companies and individuals can use digital platforms as a way to overcome constraints in their local markets and find global customers, suppliers, financing, and talent is highlighted within this context.

Finally, the MGI Connectedless Index is also described and presented indicating that advanced  economies are generally more connected than developing countries’”and the leaders are far ahead of everyone else.

You can read the full report here.