Abstract
The digital economy, driven by Information and Communication Technology (ICT), has emerged as a significant contributor to economies worldwide. However, accurately defining and measuring its impact on national economies remains a complex endeavor. This paper explores the definition, measurement, role, and impacts of the digital economy across various economies. It also examines the involvement of governments and telecommunication regulators in assessing the digital economy and identifies future directions for developing countries. A systematic literature review utilizing the PRISMA Model is employed to investigate the factors and indices used to measure the digital economy. The findings highlight ongoing efforts to harmonize the definition and metrics; nonetheless, challenges persist due to the scarcity of appropriate datasets and variations in country-specific definitions. Additionally, the effectiveness of existing digital economy indices and toolkits in assessing the level of digitalization in developing countries is evaluated. The paper concludes that despite ongoing efforts to bridge the gaps, the concept of the digital economy remains defined and measured differently, necessitating a new definition that accounts for various contextual peculiarities. Furthermore, a roadmap is proposed to develop a toolkit that ensures comprehensive measurement, thus preventing an underestimation of the digital economy's contribution to the Gross Domestic Product (GDP) in developing countries. The paper underscores the need for international and multi-stakeholder dialogue to establish a common understanding of the digital economy's definition and measurement. Developing countries, such as Nigeria, are urged to develop or adopt new metrics tailored to their unique circumstances, facilitating an accurate and efficient quantification of the digital economy's impact on crucial indicators like GDP. Improved statistical data collection and recording methodologies are recommended for both governments and the private sector. Moreover, the paper advocates for the establishment of a Digital Economy Advisory Board (DEAB) in developing countries to maximize the benefits of the ongoing global transition to the digital economy.