Chapter 2

Digital Theory of Value

Abstract

This chapter starts with an introduction on the fourth industrial revolution and its eight characteristics, followed by discussing the definition of “digital economy” and its measurement models. It then introduces the digital valuation model which includes four methods: (1) intrinsic, (2) extrinsic, (3) subjective, and (4) opportunity value. Using this model, the digital economy is measured in three ways: (1) value created from the digitization of traditional industries; (2) value created from digital-native industries; and (3) value created from having the digital option, that is, the “invisible” digital economy measured by opportunity value of the digital option. The digital theory of value is introduced ...

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