THE IMPACT OF DIGITALIZATION ON ECONOMIC DEVELOPMENT: OPPORTUNITIES AND CHALLENGES

Abstract

The rapid pace of digitalization has become a transformative force in the global economy, reshaping industries, markets, and consumer behavior. This article examines the role of digital technologies in driving economic growth, improving productivity, and fostering innovation, while also highlighting the challenges associated with inequality, cybersecurity, and labor market disruptions. The study is based on a comparative analysis of global and regional economic data, literature review, and case studies from developing and developed countries. The results show that digitalization significantly contributes to GDP growth and competitiveness, but the benefits are unevenly distributed. Effective policies, investments in digital infrastructure, and workforce re-skilling are essential to maximize its positive outcomes.