Economic Resilience and Digital Entrepreneurship

When I look back to the dark days of 2020 and to our current promising economic situation, I must confess that I’m pleasantly surprised.  Small businesses around the world were on life support during the height of the pandemic, yet for most places, the impacts were relatively short-lived and business recovery has been strong.  In fact, the US continues to hit record levels of new business startups on a consistent basis.

According to a new Asian Development Bank assessment covering 100 countries, the rise of digital entrepreneurs may be one factor driving this resilience. A multinational team of researchers sought to understand the linkages between the quality of a country’s digital entrepreneurial ecosystem and its economic performance during the COVID-19 pandemic. They found that places with a better environment for digital entrepreneurs (measured using the Bank’s new Digital Entrepreneurship Index) showed lower drops in GDP during the pandemic. They suggest that digital entrepreneurs contribute to economic growth in a manner similar to non-digital entrepreneurs, but may also support economic resilience as digital businesses can continue to operate in the event of a major crisis such as wars, pandemics, or natural disasters.