The Cyber Economy

Purpose: The purpose of this chapter is to provide a critical analysis of the initial results of digital modernization in the modern economy based on the breakthrough technologies of Industry 4.0. The chapter also introduces the concept of the ‘Cyber Economy’ as a new type of economic system. The chapter illustrates that the cyber economy is a product of digital modernization, provides a definition of the cyber economy and also scientifically substantiates the logic and sequence of the birth of the cyber economy.Design/methodology/approach: Because the expected result of any country’s modernization is to enhance the livelihoods of its citizens, an assessment of the effect of the level of an economy’s digital competitiveness on the population’s living standards was conducted. The assessment was done with the help of regression analysis using statistical data from the IMD World Competitiveness Center and Numbeo. The research was conducted on countries with the highest level of digital competitiveness in 2018, including Russia. The rationale behind the selection of countries was that they are the only ones where there is a statistically significant influence of digital modernization on the population’s living standards.Findings: As a result of studying the peculiarities of various technological modes, the stages of digital modernization for the economy based on the breakthrough technologies of Industry 4.0 were characterized as follows: the information economy, the digital economy, and, ultimately, the cyber economy. A conceptual model of the cyber economy was built reflecting its technological mode, objectives and means of management, criterion for measuring the effectiveness of management, new subjects of economic relations, and new spheres of the economy.Originality/value: It is substantiated that the digital modernization of the economy based on the breakthrough technologies of Industry 4.0 will lead to the formation of the cyber economy that will involve the close interaction of humans and fully autonomous machines within cyber-physical systems that are transparent, predictable, and manageable.

Purpose: The purpose of this chapter is to develop a conceptual model of the organization of production and distribution based on the breakthrough technologies of Industry 4.0 within the sphere of digital business.Design/methodology/approach: The authors use the case method to perform an overview of the level of automatization in sales and purchases within the Russian economy in 2018 based on the statistical data of the National Research University “Higher School of Economics.” It is determined that the automatization of only two business processes in modern Russia is frequent: purchases and sales. Digital business is becoming more prevalent in the service sector, but the pre-digital mode of business structure is still preserved in industry.Findings: The sectoral specifics of the automatization of business processes are determined based on breakthrough technologies of Industry 4.0, which should be taken into account during the statistical accounting of digital business. The following essential differences of digital business from pre-digital business are determined: complex offers, automatic internal and external communications, the organization of information processing using Big Data technologies, and the increasingly complex demands on management.Originality/value: It is shown that digital business is a complex system that consists of many interconnected elements that are integrated through the breakthrough technologies of Industry 4.0. A conceptual model for the organization of production and distribution based on the breakthrough technologies of Industry 4.0 within digital business is developed. The advantages of digital business are shown: high effectiveness, a reduction in resource use, holistic consideration of individual consumer preferences even in the case of mass offers, and sustainable development due to continuous automatic crisis management.

Purpose: The purpose of the chapter is to study the influence that the digitization of national economies has on human living standards and quality of life.Methodology: The methodology includes historical and logical analysis, systemic analysis, synthesis, induction, deduction, and graphic methods. The level of development of human capital and quality of life is studied through sociological surveys and expert methods.Results: The authors determine the current characteristics of human capital and living standards before the full implementation of Industry 4.0; determine the specific features of the digital and cyber economy that influence human living standards; evaluate the current changes in human living standards under the influence of technological transformation; and outline the conditions under which the changes will have the most positive outcomes for the quality of life.Recommendations: Governments should target regulation on the processes of digitization of the economy to increase the social protection for citizens who are at risk of losing employment. At the preliminary stages in the development of AI it is necessary to train the future work force from the preschool age, developing the key cognitive skills and supporting social entrepreneurship initiatives as an option to reduce pressures on the labor market due to robotization, automatization, and the digitization of economic activities.

Purpose: The purpose of this chapter is to determine the perspectives and to develop recommendations for the digital modernization of state regulation of the economy in Russia, using the breakthrough technologies of Industry 4.0.Design/methodology/approach: The authors perform a statistical overview of the modern Russian practice of obtaining state services by economic subject using materials from “Indicators of the digital economy 2018,” which was compiled by the National Research University “Higher School of Economics.”Findings: It is determined that in modern Russia, digital modernization of the practice of state regulation of the economy does not conform to the current needs of the cyber economy, as it is limited by its focus on only one direction (provision of state services) and it is based on traditional digital technologies (Internet).Originality/value: A conceptual model for state regulation of the cyber economy based on the breakthrough technologies of Industry 4.0 is offered, according to which the digital modernization of regulatory practices also covers other areas (monitoring of economic activities, management of economic activities, and support for a favorable economic climate) through the utilization of digital technologies including blockchain, cloud technologies, the Internet of things, AI, quantum technologies, etc. Practical implementation of the developed model will satisfy the current and future needs of the cyber economy, which is currently forming in Russia, for hi-tech state regulation.

This chapter focuses on the role of diversification in providing stable economic development for organizations under the modern conditions of the cyber economy. The author identifies the main directions in which diversification of the activities of science-driven companies should be supported by the government.The first direction includes a complex set of measures to improve the mechanisms of state regulation, which stimulate the intensive development and implementation of innovative solutions by industrial companies. The second direction proposes the development of national projects for the development and manufacture of industrial science-driven innovative products that conform to the requirements of the sixth and seventh technological modes. The third direction includes state measures to stimulate investment into various sectors of the economy to support the sustainability of innovative development, the creation of systemic elements for the Russian innovative system, and mechanisms to attract assets from nongovernmental sources into the Russian innovative ecosystem to activate new business.In order to evaluate the optimality of these directions for company diversification and their economic effects, proprietary mathematical tools are used, which allow cyber systems to make the corresponding conclusions and evaluations.The chapter illustrates the key role of cyber economic systems. In current conditions, only the effective usage of cyber economic and flexible production systems can ensure a company’s continuing competitiveness and sustainable economic development.

The development of the cyber economy is becoming a guarantor for the national competitiveness of countries. However, many developing and emerging economies do not possess the corresponding preconditions for its formation.The purpose of this chapter is to describe the necessary conditions for the transition of developed and developing countries to the cyber economy and to determine factors that assist or hinder the development of this process. Economic and mathematical analysis is used in conjunction with data from global rating surveys that characterize the development of the cyber economy to determine interconnections with a range of macroeconomic indicators. The results of the mathematical calculations indicate that, on the one hand, development of the cyber economy is predetermined by the high level of a countries’ well-being, and, on the other hand, stimulates an increase in the effectiveness of business processes in the country’s economy on the whole.

In this chapter, the connection between the digital economy and the cyber economy is determined, and the global development trends for information technologies are analyzed.The author substantiates the need to integrate production and economic processes into a unified cyber economic system to accelerate the development and manufacture of products with competitive consumer qualities, which could occupy the dominant positions and satisfy demand in existing markets. He also advocates that rapid development products with innovative qualities and unique consumer characteristics should be launched to create new markets and satisfy new needs in society.The author formulates and solves the important task of determining the necessary level of resource provision, for the creation of both types of products with the usage of methodological tools.Management of resource provision is aimed at creating an optimal balance for all types of an organization’s resources in the global information space, which, as a result of their realization in the form of finished products, create the potential for acquiring either a large market share or satisfying market demand in new markets. The task of creating this optimal balance for all types of resources, through the optimization of business processes and organizational models is a very important element in the process of the creation of cyber economic systems.

This chapter focuses on the principles behind the functioning of intelligent systems and machines in the economic activities of the cyber economy. Using the example of an intelligent system for the management of the construction of a road, the author illustrates the possibilities for the automatization of business processes. It is shown that on the basis of data from remote probing of the Earth, processed with the help of AI methods, it is possible to determine the economic state of the subject of a space survey and solve the economic tasks connected to development, monitoring, and provision of the necessary resources for the subject without human participation. This allows for a reduction in the labor intensity of the processes and the likelihood of corruption, and connects the digitization of the Earth from space to the needs of the digital economy.Mathematical tools are used to show the influence that the usage of intelligent systems and machines has on economic growth and labor efficiency.

Purpose: The purpose of this chapter is to study the technical, sociocultural, and economic role of intelligent machines (also sometimes referred to as “intelligent agents”) in the cyber economy. We present research results, conclusions, and recommendations on the systemic involvement of intelligent machines into the socioeconomic relations in the near future.Design/methodology/approach: Not long ago it seemed that the usage of intelligent machines as an integral part of the economy would be many years away. However, the rapid technological shift in the second part of the twentieth century has enabled the intellectualization, automatization, and robotization of physical and virtual (digital) space. Intelligent machines now perform key roles in the socioeconomic relations of the cyber economy. In this chapter, the authors use content analysis of a wide range of publications, statistical analysis of the data on implementation of intelligent machines in the cyber economy, and futuristic forecasts regarding the midterm perspectives and limitations of using such agents in socioeconomic relations.Findings: The research shows that the participation of intelligent machines in the cyber economy has already been established and has a positive influence on the development of global socioeconomic relations, stimulates the growth of national economies, and provides significant labor efficiencies. Conclusions regarding the performed study and future directions of research are offered.Originality/value: It is substantiated that the benefits of using intelligent machines could be lost through economic and reputation losses. That is why there is a necessity for the institutionalization of the space of interaction between humans and intelligent machines under the condition that such intelligent agents have limited autonomy over their functioning and decision-making (i.e., they are controlled by humans), but they are also able to conduct monitoring of human activities and have the right to block human actions that are beyond their competences (through a system of controls and counterbalances).

Intelligent machines have become important elements in modern economic development. This chapter studies potential directions for the application of intelligent machines in the cyber economy with a focus on industry, the development of cities, and healthcare. The opportunities and challenges of such applications are analyzed.

The goal of this chapter is to assess the impact of the transition to a digital economy on the labor force. To achieve this goal, the methods of analysis, synthesis, comparison, and statistic modeling have been used. Digital technologies are becoming increasingly ubiquitous and while raising labor efficiency, there are negative impacts on workers who lose employment. How to solve the problem of a redundant workforce is a critical issue as there is no strategy for this adaptation. Active and passive measures to combat technological unemployment, proposed by scientists and politicians, are ineffective and cannot realistically provide a livelihood for the huge number of workers released. Therefore, the question of the displacement of living objects by IT objects remains open. The results obtained in the course of this study can be used in further studies on structural (technological) unemployment and the problems of the labor market in the cyber economy.

The chapter considers the issues of mathematical description and formalization of autonomous intelligent machines functioning in economic systems. A definition of intelligent machines in the cyber economy is given. It is shown that intelligent machines could be effectively used to solve various economic tasks. We employ the tools of finite-state machines and game theory to describe intelligent machines in the cyber economy and illustrate the importance of machine learning and the methods of AI. It is determined that the best AI method is conformation learning that fully corresponds to the architecture of intelligent machines in the cyber economy. The authors show the importance of the creation of unified standards for describing the interfaces of intelligent machines.

Purpose: The purpose of this chapter is to specify the long-term consequences of a transition to the cyber economy for digital personnel, which are required and created for its formation, in the interests of preventing a social crisis through determining the place and role of digital personnel in the cyber economy.Design/methodology/approach: The authors use regression analysis for determining the current value of digital personnel for the forming cyber economy (at the current stage of the digital economy) and for evaluating the influence of the share of specialists in the sphere of information and communication technologies (ICTs) at the level of digital competitiveness as an indicator of readiness for transition to the cyber economy. The research is performed using a selection of countries that show the best results in the sphere of digital modernization of economy (Top 30) in 2018. The information and analytical basis of the research is statistical data produced by the National Research University “Higher School of Economics” and the IMD.Findings: It is determined that a high level of automatization (up to full automatization) can only be achieved at one of the four stages (the production stage) using the algorithm for the creation of added value in the conditions of the cyber economy. All other stages will require different types of digital personnel, including specialists in the spheres of ICT, machine building, and extremely specialized sectoral digital personnel, who will have the key role, performing essential functions with machine technical support.Originality/value: It is established that there is a low level of risk of a social crisis in the labor market. It is shown that specialists with high levels of qualification will be in the highest demand. The main priority in the training and development of digital personnel should be paid not to quantitative (number of personnel trained) but qualitative indicators (the level of personnel qualification).

Purpose: The purpose of this chapter is to study the current problems of training digital personnel for the cyber economy and to propose solutions.Methodology: On July 28, 2017, the Government of the Russian Federation adopted a Decree on the implementation of a program of the digital economy in Russia. Its purpose is to form the infrastructure for a comprehensive information-based economy and to train personnel to develop the Russian digital economy. Thus, Russia plans to perform a qualitative transformation of the economy by 2024. This requires action in the following spheres: modernization of the digital infrastructure, implementation of digital practice into all key sectors of the economy, and the training of skilled personnel for the transitional period. In order to prepare skilled digital personnel, it is necessary to rebuild the conservative system of education and to stimulate graduates to work within the digital sphere. Universities have a key responsibility in this process, as they control the main concentrations of knowledge.Results: By outlining the main problems surrounding the training of personnel for the digital economy, we determine ways to solve them: increased financing of education in the sphere of digital technologies, differentiating programs for the training of IT specialists, and involving large companies in the educational process through the organization of internships and further employment for graduates.Conclusions: The current Russian system of education pays insufficient attention to the training of competent specialists in the sphere of information technologies. However, Russia has the resources to overcome this problem and train skilled personnel through the provision of attractive jobs with scope for professional growth.

The authors show that in the conditions of the cyber economy digital competence is one of the key factors of employee competitiveness in the labor market. The authors determine interconnections between technical modernization and reequipping of organizations and the need for the development of employee competencies to create cyber-physical systems of management.The importance of the task of diagnostics in order for managers to assess employee competencies according to the modern requirements of the cyber economy is substantiated. This task is important for all categories of a company’s personnel: managers, specialists, and employees who are either involved in key scientific and production activities or have roles related to their organization and maintenance.A methodology of diagnostics for employee competence is offered. It is used to determine the need for development of digital competencies in the conditions of the cyber economy and is based on the implementation of a three-stage algorithm, which contains the model of evaluation of the level of competency. The authors distinguish competencies that are the most important for development of personnel in the conditions of the cyber economy to support a high level of organizational competitiveness.The diagnostic tool makes it possible to measure how closely employee competencies conform with the conditions of the cyber economy, and take decisions to plan improvements if they are deemed necessary.

The current formation of the cyber economy requires the development of new competencies in the labor force. In this chapter, the author considers the key competencies that need to be developed.The increase of the role of information technologies in the modern economy presents new challenges for those who work in retail, the public sector, finance, and production. In order to achieve the expected increases in competitiveness, organizations must ensure that their management systems ensure the high levels of personnel training.

Purpose: The purpose of this chapter is to develop a conceptual model for a university based on EdTech and a scientific and educational platform to train digital personnel for the cyber economy.Design/methodology/approach: The authors use the case method to analyze Russia’s experience to date with the EdTech sector. In addition, through the use of the statistical data of the World Economic Forum for 2016 and the IMD for 2018 the authors assess the efficiency of the scientific and educational platform for training digital personnel for the cyber economy.Findings: It is substantiated that the existing paradigm for training digital personnel for the cyber economy does not offer universal practical solutions. The generally accepted theory on the division of scientific and educational functions for EdTech subjects do not conform to the needs of modern Russia and instead of stimulating the development of digital personnel restrain digital modernization due to a deficit of competencies and the low effectiveness of the scientific and educational infrastructure for digital business.Originality/value: The authors specify the conceptual foundations of the process for the formation of EdTech—which is to become a scientific and educational platform to train digital personnel for the cyber economy. The developed conceptual model of a hi-tech university using EdTech and a scientific and educational platform to train digital personnel reduces uncertainty and provides solutions to current training problems.

Purpose: The purpose of the chapter is to study the process of creating highly efficient jobs in the cyber economy through the integration of AI and employees’ mastering new digital competencies.Methodology: Evolutional (historical) methods, analysis, synthesis, and algorithmization are used.Conclusions: It is determined that the modern labor market is peculiar for the emergence of a new type of employee—AI. The management of labor efficiency in the cyber economy is oriented not at humans but at robots, which reduces production costs. Depending on the level of coding of operations, highly efficient jobs in the cyber economy are either fully replaced by AI or envisage effective interactions between humans and AI. In the latter case, human employees will need to continually improve and develop their cyber competencies. In order to measure the efficiency of a job working with AI, there has to be an integral indicator taking account of the usage of resources, involvement of employees, and work satisfaction.Originality/value: The authors propose competencies that employees have to possess with the wide implementation of AI technologies. They reflect on the conditions in which highly efficient jobs could be created, and offer a vision for the transformation of jobs into highly efficient jobs within the cyber economy.

Purpose: This chapter considers the development of mechanisms for the interaction of intelligent machines and digital personnel in the industrial production process of Industry 4.0.Design/methodology/approach: In order to evaluate the scale of potential interactions between intelligent machines and digital personnel, the author performs a structural, horizontal, and trend analysis of the current (2016–2018) and forecast (2019–2025) statistical data from the National Research University “Higher School of Economics” and PricewaterhouseCoopers (PwC).Findings: It is determined that interactions between intelligent machines and digital personnel in the industrial production processes of Industry 4.0 will be based upon the mechanism of labor division. Routine functions will be performed by intelligent machines; AI and controlled robots, manipulators (possibly also controlled also humans), unmanned transport vehicles (also controlled by humans), and digital devices that are connected to the Internet of Things; while managerial functions in the cyber economy will be performed by digital personnel; AI engineers, digital marketing specialists, digital production managers, digital innovators, digital production engineers, and digital quality assurance specialists. This will increase labor efficiency and provide a balance between intelligent machines and digital personnel.Originality/value: It is substantiated that due to the expected functional load of digital personnel and growth of demand for them in the industry of 2025 in the likelihood of social unrest due to mass unemployment of digital personnel is improbable. On the contrary, it is possible to expect growth in the quality of life of digital personnel who are involved in Industry 4.0.

Purpose: The purpose of the chapter is systemic study of the future labor market in the cyber economy in view of the influence of not only the demographic factor but also of the more important technological factor, which is connected to formation and increase of competition between intellectual machines and digital personnel.Methodology: The authors determine the influence of the demographic and technological factors on the future of the Russian labor market. The authors perform analysis of statistical data for the Russian labor market, which allows forecasting further expansion of the spheres and popularization of automatization of the production and distribution processes in the Russian economy. Thus, the need for digital personnel will reduce, as their functions will be taken over by intelligent machines.Results: It is determined that in modern Russia no efforts are made for assessment of the potential needs for digital personnel either at the government, university, or corporate levels. Training of digital personnel is announced as a strategic priority of the national program “Digital economy of the Russian Federation” dated July 28, 2017, No. 1632-r. In view of the determined highly probable negative influence of the technological factor (growth of competition of intelligent machines and digital personnel), it is possible to forecast a crisis of the Russian labor market in the future.Conclusions: It is substantiated that a crisis is imminent in the Russian labor market: firstly, due to growth of competition of digital personnel under the influence of the increase of their number and, secondly, due to establishment and growth of competition of intelligent machines and digital personnel. It is concluded that it is necessary to have state anti-crisis management of the Russian labor market.

Purpose: The purpose of the research is to determine the possible scenarios for the development of the agro-industrial complex (AIC) in the cyber economy of Russia and to determine the most optimal path forward from the perspective of the provision of national food security.Design/methodology/approach: The authors use the method of scenario analysis, which allows a determination of the consequences for the national food security of Russia for various scenarios of development of the AIC. The forecasts are compiled for the period until 2024. The method of regression analysis is applied to determine the dependencies of key indicators for Russia’s national food security—affordability, availability, quality, and safety—on the share of companies in the agro-industrial sector that performs innovations, and the cost volume of implemented fixed funds in this complex for the period 2009–2018 (the post-crisis period).Findings: The authors determine the positive influence of innovative development (digital modernization) in the Russian AIC at the level of national food security. This leads to the conclusion that the most optimal scenario for the development of the AIC in the cyber economy of Russia is a transition to a cyber AIC, which envisages the highest level and systemic character of automatization and the use of the breakthrough digital technologies of Industry 4.0. Within the scenario that envisages a transition to a cyber AIC the maximum (100 points) value of the indicators of food security—price accessibility, guarantee of quality and security of food products, transparency of production and distribution, full-scale information support for interested parties, and free communication with manufacturers—will be achieved.Originality/value: A conceptual model of cyber AIC is developed. It is recommended for practical application not only in modern Russia but also in other countries of the world.

Purpose: The purpose of this chapter is to study socioeconomic problems and perspectives on the development of the cyber economy in modern Russia, as well as to present the results of research into the implementation of the program for the digital economy.Design/methodology/approach: An analysis of data from a range of national and international reports, documents, and programs devoted to innovative development of the digital economy allowing an identification of the key vectors for the strategic development of socioeconomic processes of Russia.Findings: The analysis shows that implementation of a complex program of digitization has serious obstacles to overcome, caused by factors that hinder the development of the key spheres of economy and a transition to the new technological mode (drawbacks in the regulatory and normative environment, low Internet coverage, insufficient implementation of digital technologies into the national system of education, low level of digitization in local administrations, growth of cybercrime rates, and insufficient effectiveness of scientific research connected to creation of prospective information technologies).Originality/value: Requirements for the digitization of certain spheres of the economy are substantiated and characterized, and target indicators for implementing the program of the digital economy in Russia by 2024 are offered.

Purpose: The purpose of the chapter is to develop an algorithm for the crisis-free transition of the modern socioeconomic systems to cyber economy.Design/methodology/approach: The case method is used to review modern economic systems and to determine the need and readiness for starting the process of a transition to the cyber economy in developed and developing countries. The statistical data of the IMD, the World Bank, and the World Economic Forum as of early 2019 are used. In order to cover both developed and developing countries (ensuring the representativeness of the selection), the authors study the top 10 countries from the first half of the rating (1–10) and the top 10 countries from the second half of the rating (31–40) with regard to digital competitiveness.Findings: It is substantiated that the process of transition of the modern socioeconomic systems to the cyber economy is largely determined by the national specifics. A universal algorithm of a crisis-free transition to the cyber economy is offered.Originality/value: Recommendations are made in the sphere of crisis management for the cyber economy (at its formative stage and in its development and functioning), which conform to the current needs of both developed and developing countries.

Purpose: The purpose of the chapter is to examine the possibilities for cyber management based on cyber-physical systems in the context of the formation of a new model of development.Design/methodology/approach: The research is performed with the help of regression analysis. The authors determine the regression dependence of the indicators for the competitiveness of the public (first pillar: Political and regulatory environment) and corporate (second pillar: Business and innovation environment) management of the indicators for the usage of new information and communication technologies in business (seventh pillar: Business usage), government (eighth pillar: Government usage), and the economy as a whole (ninth pillar: Economic impacts). The work is based on data and empirical materials in The Global Information Technology Report 2016, prepared by the World Economic Forum. The research objects are 20 countries, comprising the top 10 (1–10, developed countries) and the second (31–40, developing countries) in the World Digital Competitiveness Ranking for 2018, compiled by the IMD (63 countries in total are rated).Findings: It is substantiated that the possibilities for cyber management based on cyber-physical systems in the context of the formation of a new model of development are substantial. The key directions for automatized state management are monitoring and control, statistical accounting, determining violations of the law, information and consultation support, and provision of state services. The key directions for automatized corporate management are economic accounting and reporting, production management, personnel management, and marketing management.Originality/value: The developed structural and logical scheme of cyber management based on cyber-physical systems shows that such systems could be created at both the micro- and macro-levels using end-to-end (currently actively being developed) digital technologies of Industry 4.0: Internet of Things, AI, and Ubiquitous Computing. This could help to provide the expected advantages and support the announced principles of a new model of development: transparency, accessibility, and full openness of state management, as well as the effectiveness, flexibility, and integration of corporate management.

Purpose: The authors interpret the cyber economy (digital economy) as business activities in which information becomes the primary factor of production, as well as that part of economic relations which is mediated by the development of the Internet and digital communication in the field of information.Design/methodology/approach: The authors perform analysis of the factors of production in the cyber economy and determine the current problems for the business sector, which are connected to imperfection of governmental regulation in the cyber economy. Modeling of the behavior pattern of the market entity and information asymmetry in the goods and services market is performed.Findings: The authors develop the scientific and methodological provision of the decision-making process in the cyber economy, which includes the algorithm of this process (which reflects its sequence and logical structure) and formulas for evaluating its efficiency at the corresponding stages.Originality/value: The authors determine that information asymmetry will be present in any market. In the business sector, however, it should be minimized. This can be achieved through thorough control over information on the part of the state, nonprofit organizations, and people engaged in socially important areas of activities (in educational, medical organizations, etc.), as well as through the support of the decision-making process. It is difficult to reduce information asymmetry in the market economy, but the complexity is simplified in the course of transition to the cyber economy due to the large number of information transmission and dissemination channels.

Purpose: The purpose of the chapter is to determine the potential growth vectors of the cyber economy and to develop recommendations for their activation in modern economic systems.Design/methodology/approach: To determine the potential growth vectors of the cyber economy the authors use the logical method and the method of proof by contradiction, which is based on the law of double negation. The authors also use the method of regression analysis for determining the influence of various potential growth vectors on development of the cyber economy. The information and empirical basis includes statistical materials from the World Bank and the IMD from 2018. The research objects are countries that show the highest level of development of the cyber economy as of 2018 (the highest share of medium-tech and hi-tech spheres in their gross added value).Findings: It is determined that the main growth vectors in the cyber economy—internal hi-tech production, R&D, and education—do not have sufficient potential to stimulate the rapid development of the cyber economy. In order to fully realize the Fourth Industrial Revolution it is necessary to enable additional growth vectors for the cyber economy—hi-tech exports, energy, and telecommunications. At present, these additional growth vectors for the cyber economy are not sufficiently active due to incompletion of the process to institutionalize the practice of hi-tech exports (while preserving national competitive advantages) and attracting private investment into energy and telecommunications.Originality/value: It is substantiated that the activation of additional growth vectors for the cyber economy is connected to the implementation of corresponding institutional measures from the state. A proprietary model is offered to illustrate this. Practical implementation of this model will ensure a systemic approach to support additional growth vectors for the cyber economy and the emergence of the synergetic effect—an acceleration of its development.

Purpose: The purpose of this chapter is to determine the factors that influence the development of the cyber economy, to evaluate their strengths, and to develop a mechanism to manage them in both developed and developing countries.Design/methodology/approach: The authors evaluate the influence of traditional (universal) factors of economic growth: institutional development, infrastructure, financial markets, and globalization. The resulting (dependent) variable is the digital competitiveness index. The influence of these factors is assessed with the help of the method of regression analysis based on the data of the IMD, KOF, and the World Economic Forum for late 2018/early 2019. The objects studied are the most developed economies (the G7) and the leading developing countries (BRICS).Findings: It is determined that the cyber economy is, in general, strongly influenced by the traditional factors of economic growth. However, it is shown that the external factor (globalization) has only a small influence on the development of the cyber economy, while institutional provision is the most important. Developing countries have less mature and effective institutions and therefore less favorable conditions than developed countries for the development of the cyber economy. Developing countries also lag behind developed countries with regard to other factors.Originality/value: In order to level the disproportionate development of the cyber economy in developed and developing countries, we developed a mechanism to manage the key factors that offers different recommendations for countries of both groups and reflects the general logic of managing the determined factors. The additional advantage of the developed mechanism is its potential for stimulating stability and active innovative development in the cyber economy.

Purpose: The purpose of the chapter is to study how international economic integration can boost the competitiveness of the cyber economy.Design/methodology/approach: The authors analyze the global turnover of the export of services for 2017–2018 and determine the future state of the cyber economy for certain countries. The potential growth of GDP indicators for the period 2025–2050 is studied, and perspectives on the global economic development of three groups of countries are considered. The share of expenditure for measures to support the cyber economy is determined for particular countries. The role of the cyber economy in Russia as a factor in international economic integration is also discussed. A SWOT analysis of the integrative activities of organizations for implementing the measures of the cyber economy is performed.Findings: The calculations show that in 2020, the growth rate of GDP coordinated with the long-term balance of payments in Russia will reach 134%, and will continue to grow to 146.8% by 2025 and 154.4% by 2050. This growth is connected to the cyclic character of economic development in conjunction with the implementation of long-term, large-scale measures for the digitization of the Russian economy.Originality/value: The formation of the cyber economy is subject to laws aimed far into the future, but it originated in the age of the birth of capitalism.

The evolution of economic systems requires changes in the ways that they are managed and, therefore, dictates new approaches for the conduct of scientific research and the training of personnel.The purpose of this chapter is to characterize the processes for the integration of universities, science, and industry with the needs of the cyber economy.The research is divided into three main blocks: characteristics of the main directions of such integration, determining potential problems, and the development of proposals for its acceleration.The research shows that in the modern conditions of widespread digitization, the rapid development of universities, scientific institutes, and industrial companies could and should be built on a close and systemic approach to integration processes and on the creation of a unified closed cyclic system, which satisfies the disparate needs of the digital economy: from the training of skilled personal to the implementation of applied R&D to industrial production through the application of modern digital technologies.

This chapter studies the economic essence of Industry 4.0. The law of interconnection between competencies and the emergence of new markets is used to substantiate the dependence of demand for innovative products on the effective functioning of science-driven companies and on the development of fundamental science as a whole. A generalized list of internal resources and characteristics of a company, which influence its innovative potential, is given, and a mathematical evaluation of innovative potential is provided. The influence of the effective usage of a company’s innovative potential on the competitiveness of the products that it produces is shown. A scheme for a self-reproducing process to improve competencies is presented, and the tools of competency management for a company implementing the technologies of Industry 4.0 are studied. Formulas for a mathematical description of innovative technology and its competitiveness are presented. An algorithm for the development of a strategy to implement the technologies of Industry 4.0 and the tools of competency management in digital industry are given.

For Russia, a major producer of natural resources, digitization and implementation of the principles of Industry 4.0 into the sphere of environmental resources management is a strategic task. This will allow preserving and using natural resources effectively, as well as ensuring the ecological well-being of the country.The purpose of this chapter is to identify improvements to the existing mechanism of environmental resources management for implementing the principles of Industry 4.0.Methodology: Тhe theoretical and methodological basis of the research is scientific work by both Russian and foreign scholars on the digitization of the economy, creation of Industry 4.0, rational use of natural resources and environment protection, and sustainable development.A systemic approach was taken using a complex set of methods and methodologies that conform to the research tasks. The main scientific tools are economic analysis, including ecological and economic analysis, and various types of systemic analysis: conceptual content analysis, information modeling, theory of sets, and theory of multidimensional information spaces.Results: It is shown that the formation of the cyber economy, in which all elements of the economic mechanism of environmental resources management interact with the help of information technologies on the basis of AI, requires a corresponding favorable environment. To achieve this, it is proposed that there should be a fundamental modernization of the economic mechanisms for natural resources management to harmonize the normative and legal foundation, add methodological provisions, provide organizational and economic support, and incorporate financial, technological, and social components. It is determined that the process of digitization and implementation of the principles of Industry 4.0 should be aimed at achieving the functioning of the national economic system so that the goals of economic development do not contradict ecological imperatives. Only through the strict observation of this criterion will well-balanced and sustainable socioecological and socioeconomic development of the national economy be able to provide competitiveness in the global markets.

Purpose: The purpose of this chapter is to develop a model for the sustainable development of the cyber economy based on the creation and implementation of “green” innovations.Design/methodology/approach: In order to study the issue of sustainable development of the cyber economy based on “green” innovations the author uses the method of regression analysis. The author determined the influence of the values of the indices of digital competitiveness, calculated by the IMD, on the values of indices for the green economy, calculated by Dual Citizen LLC in early 2019 (based on data from late 2018). The countries selected for the research are those with the highest values in the green economy index (Top 33). To logically explain the determined regression dependence the author performs a SWOT analysis of sustainable development for the cyber economy based on the creation and implementation of “green” innovations.Findings: It is determined that the formation of the cyber economy may stimulate the achievement of global goals in the sphere of sustainable development. Potential environmental risks, which appear or increase with the cyber economy, could be prevented or reduced through the adoption of the offered model for sustainable development of the cyber economy. The model is based on the circular mechanism of industrial production, tax stimulation of R&D, and responsible consumption.Originality/value: Practical implementation of the developed model will support the high ecological effectiveness of the cyber economy through a reduction in the consumption of natural and energy resources.

Purpose: The purpose of this chapter is to evaluate the effectiveness of the application of government tools to manage the current digitization of Russian society. We analyze the specific measures that are implemented in a number of countries for the market subjects of digital tools and analyze the existing normative documents on the implementation of the philosophy of Industry 4.0 in Russia.Government control of the transition to the cyber economy is impossible without a normative and legal basis for the interactions in this sphere. In this chapter, the authors focus on the list of adopted documents, purposes and tasks of implementation, and the indicators of target planning on informatization.An adequately selected list of target indicators will determine future government policy for the process of informatization in all spheres of the national economy. The indicators for government measures that are set at the planning stage should correspond with the final results.Methodology: The following methods are used: comparative analysis of data, dynamic assessment, comparison, analogy, and systematization.Results: Through the study of the main normative and legal documents of government control that determine the possibilities and potential directions for the informatization of the Russian economic system an assessment of the achieved results of informatization in certain spheres of the socioeconomic environment is performed. The main target indicators for digitization and the future landscape of the Russian cyber economy are considered; achievements in the transition to Industry 4.0 are studied; and conclusions on the possible successes in various spheres of public and economic life in Russia are made.Recommendations: The current tools for government control over the processes for the informatization of Russian society should be reconsidered in respect to certain tasks and target indicators for the future transition to full digitization of all spheres of the national economy.

It is possible to conclude that the term “cyber economy” has found its place in the modern scientific lexicon and it fully and precisely describes the new type of economic system that will form in the process of the Fourth Industrial Revolution. Formation of the cyber economy starts deep transformation processes at all levels of economic activity. The organization of production and distribution, based on the breakthrough technologies of Industry 4.0 and digital business, continues to become more popular. The diversification of consumption and modernization of state management are moving ahead apace.