What is new about the “New Economy”?

The Internet boom of the last half of the 1990s seemed to herald the arrival of a “New Economy” with its promise that, after the stagnation of the early 1990s, innovation in information and communication technologies (ICT) would regenerate economic prosperity. The subsequent collapse of the Internet boom at the beginning of the 2000s called into question the New Economy's ability to deliver on this promise – and even raised questions about whether there had really been anything “new” about the economy of the late 1990s after all. Perhaps the journalist John Cassidy (2002) was correct to entitle his well-documented book on the Internet boom “dot.con: the greatest story ever sold”. If the “New Economy” was just all smoke and mirrors, one would expect that, once the debris left behind by the storm of speculation and corruption had been cleared away, economic life would return to what it had been before the boom took place.

It is now clear that there was plenty of e-con in the New Economy. At the same time, however, there was something new, important, and permanent about the New Economy that transformed the economic lives of many from what they had been before. The core of that something new and important is what I call the “New Economy business model” (NEBM), a mode of organizing business enterprises that has changed, perhaps dramatically, the ways in which, and terms on which, people are employed.