Digital Economics

The digitization of such traditional goods as books music and movies in combination with traditional digital productions like software has given rise to new twists and turns in economic arguments. The primary reasons for these digital-led developments in economic theory are that digital goods often exhibit network effectsconsumer benefits that grow with the spreading use of certain goodsand that digital products often have low or negligible reproduction costs. McKenzie describes how the advent of digital goods has forced changes in firms'' production and pricing strategies and how it has led to the reassessment of an array of public policies from privacy to piracy.