The Banking Executive Magazine - September Issue 2022

Virtual Economy considers the virtual economy as a speculative activity based on the use of money capital. The second ap- proach considers the virtual econ- omy as a higher level of digital economy. The third approach con- siders the virtual economy as part of the digital economy in the form of virtual online worlds. Within the first approach, the defini- tion of a virtual economy is closely related to the monetary form of cap- ital. According to the second approach, the virtual economy is part of the three interconnected levels: Informa- tion and Communication Technol- ogy (ICT) infrastructure, Virtual Economy and Digital Economy, as shown in figure 2. In the three levels hierarchy, the virtual economy is a higher level, which is based on the digital economy and ICT infrastruc- ture. In the third approach, the prolifera- tion of digital services from e-com- merce to social networking services in developed as well as developing countries has given rise to new digi- tal needs and problems. The rise in demand and supply to meet digital needs, and the markets where the de- mand and supply meet, together comprise the virtual economy. Typical characteristics of a virtual economy include: • centred around commodities that are digital yet scarce; • demand arises from the increasing use of digital services in business and leisure; • supply is created through the ex- penditure of human effort. The various approaches to the defi- nition of digital and virtual economies can be combined in the framework of the concept of dataism, whereby the universe consists of data flows, and the value of any phenom- enon or entity is determined by its contribution to data processing. Figure 1 depicts the evolution from Antique economy (old concept of economy) to a new databased econ- omy (new virtual intangible and fi- nancial economy based on the concept of dataism). the BANKING EXECUTIVE 12 ISSUE 165 SEPTEMBER 2022 Figure 1. Evolution from antique economy to database economy based on the concept of dataism (source: The world bank and infodev research report by Lehdonvirta and Ernkvist [6])