(1) Definition of New Economy
Updated Nov 16, 2017
New economy is a buzzword describing new, high-growth industries that are on the cutting edge of technology and are the driving force of economic growth. The new economy is commonly believed to have started in the late 1990s, as high tech tools, particularly the internet and increasingly powerful computers, made their way into the consumer and business marketplace. The new economy was seen as a shift from a manufacturing and commodity based economy to one that used technology to create new products and services at a rate that the traditional manufacturing economy could not match.
(2) How Does the New Economy Work?
Industry trends have always adapted to changes in technologies, incorporating and often initiating changes to improve productivity, quality, and profitability. With the rapid growth of communications technologies from the mid 1980s, companies have been able to adapt even faster. An important component of the new economy is the global span of many business processes and linking value chains (i.e. designers, suppliers, producers, marketers, distributors, and customers) together using communication and management technologies. Since companies have been focusing on their core competencies and using these new communication tools, organizations have been able to outsource efficiently and improve their profitability.
(3) Meaning of the new economy in English
Activities based on knowledge information rather than traditional industries such as manufacturing: software and electronic equipment have been the drivers of the new economy.
(Definition of the new economy from the Cambridge Business English Dictionary © Cambridge University Press) 2017