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Newsletter of Feb 28, 2019

Our new Crossroads video explores how people in countries as diverse as the United States, Cuba or India learn new tricks in order to cope with the digital economy.

 

Who Really Wins from the Digital Economy?

Digitization is rapidly re-assembling the nuts and bolts of the global economy. Its disruptions are profound but uneven. From Cuba to Mozambique, from Argentina to India people, companies and governments have found different strategies to cope with the new digital world and a digital economy. In the latest entry to our Crossroads series Samuel George traces down how. Join him on his journey around the globe!

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Will the Digital Economy Change the Rules of the Game in the World Economy?

A central prerequisite for a functioning market economy is that there are many companies and many consumers. In this case, nobody has market power, which can be used to the detriment of others. The digital economy could change the situation. Special features in the cost structure and characteristics of digital goods can cause monopolies. The resulting superstar firms are able to increase their profits at the expense of consumers and employees.

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India Can Lead the Way on Global Trade

At this point, India may be one of the few large economies able to provide leadership in international trade. The US under President Trump seems to have all but kissed goodbye to multilateralism. The EU at the moment seems too pre-occupied with issues like BREXIT etc., while China although has been waxing eloquent about multilateralism questions. Besides, it is presently caught up in a trade war-like situation with the US.

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$ 21.9 Billion – That's How Much US Tariffs on German Cars Could Cost the German Car Industry

With the United States on the verge of imposing US tariffs on German cars, we take a closer look at the German car industry’s exposure to the US market. To paint a more nuanced picture of the economic relationship, we apply a supply chain or added value approach. Our analysis shows that the German car industry could lose up to $ 21.9 billion in added value.

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EU Japan Trade Deal: Free Trade Is Not Doomed!

From February 1st, 2019, the EU and Japan will start to build a large free trade area with about 640 million customers. Calculations by the ifo Institute on behalf of Bertelsmann Stiftung show that both sides will benefit from the EU Japan trade deal. Moreover, it is a strong signal that economic cooperation and integration are still possible in times of Trump and Brexit.

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Andreas Esche

Director, Program Megatrends

 

Bertelsmann Stiftung

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