Introduction

Abstract

In the wake of the stock market boom, the internet hype of the 1990s is over. However, the digital economy — the information and communication technology (ICT) sector — is well alive in OECD countries; once the sector has become so important for overall investment, it is only natural that ICT dynamics become more cyclical. Moreover, the well-known imperfections of information markets present some specific obstacles for strong positive growth-enhancing effects of the internet business. There are also some hard facts which should not be overlooked when discussing the New Economy. In 2000, the number of software engineers in the US exceeded the number of all engineers in traditional fields for the first time. At the same time, it is true that there is considerable uncertainty about the scope and nature of productivity growth acceleration in the US, Europe and to a lesser extent in Japan within the period after 1985; the renewal of global US economic leadership is strongly linked to the long economic boom of the 1990s to which ICT dynamics have contributed considerably. With the share of ICT value-added in overall GDP in the US almost doubling in the 1990s and coming close to 10% at the beginning of the 21^st century and with quality improvements playing an enormous role in the chip and computer industry, respectively, the topic of hedonic price measurement has been emphasized in the US and, more recently, in Europe. All the EU countries will adopt hedonic price indices in 2003. Beyond methodological issues, there are important economic aspects to be analyzed. These range from productivity and growth issues to issues of capital market financing, regulation of telecommunications and the internet at the national and international level to questions of labor market deregulation and workplace organization in large and small firms. While the New Economy has economic significance in itself, one must also raise the question to which extent it will stimulate sectors in the Old Economy.