What is the New Economy ?

Modern economy is no longer driven by physical flows of material goods and products but by ethereal flows of data, images and symbols. On the demand side, we consume more and more content-based information and entertainment. On the supply side, intangible assets such as brand, human capital, intellectual property and knowledge have become major determinants of performance and value. Welcome to the intangible economy.

Its logic is radically different from the conventional economics. It is driven not by scarcity but by abundance. It lifts the constraints of geography and physical resources availability. Traditional pricing and transaction mechanisms do not adequately capture the economic value of intangibles. New markets and business models are emerging.

Intangible economy transforms radically all economic activities. Stable borders between the firm and its environment wither away, traditional distinctions between production and consumption or clients and suppliers are no longer pertinent. As a result, schizophrenia appears as a guiding principle of business strategies. Competition has never been keener; the fight for market share, more brutal. At the same time, alliances proliferate and firms build elaborate co-operation and sharing networks.

I started working on the concepts of the Intangible Economy in the early 1990s and  presented them in a book published in French in 1994, "L'utile and futile - l'économie de l'immatériel" (The useful and the wasteful - the Intangible Economy). The book and its underlying themes generated considerable interest not only in France but in many other countries. In response to this interest I wrote a number of research papers and articles. These papers have focused on measurement difficulties, which lead to serious underestimation of the extent and the importance of Intangible Economy. 

I was also invited to made several presentations to various audiences. In addition to mapping out the main themes of Intangible Economy, these presentations dealt with the implications of Intangible Economy for financial markets, business strategies and public policies.

If you want to find out more, have a look at our presentations and publications or comments on my work. You may also visit links to other people and organisations, interested in similar topics.

For those of you with a short attention span, we formulated eight laws of Intangible Economy

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