World better off with China's embrace of Internet

China's economy used to be driven mainly by investment and export, but the exhaustion of demographic dividend and decrease in investment return rate make the old pattern difficult to provide employment or economic growth.

As the consumption can hardly support a new pattern, China has to restart reform from supply-side, which means not only to improve the efficiency of existing industries but also to use new supply to create new demand. In the process, Internet can surely play a key role.

Internet has been around for 25 years and became industrially applicable only about 15 years ago. The industry is growing exponentially under the Moor's Law, but its potential is unlimited.

The magic power of Internet can mainly be viewed technically, economically or socially.

In technology, Internet actually means several things: Data collecting, based on various terminals such as computers, mobile phones, intelligent watch, monitors and many other sensors; data storage, locally or in the cloud; data processing, by all kinds of models or even machine learning; communication, which is related to data transmission. Internet, armed by artificial intelligence, can become so smart that experts are predicting that we may be the last generation since the possible "Singularity" can come to resolve all problems or finish all human beings.

In economy, Internet plays a key role in business world. As Ronald Coase first pointed out in 1937 in The Nature of Firm that both markets and companies (as "special market") have its cost, on the margin there is a balance by decisions of manufacturing themselves or buying from markets. Many scholars believe that transaction costs are the basic reason of how organizations including markets, enterprises and politics evolve. While information technology can dramatically reduce the costs of both market deals and company management by reducing information asymmetry. It is not difficult to see the strategic importance of China's choosing "Internet Plus" to start the supply-side reform.

However, the technology will change the social decision process and even eventually the politics by applying big data analysis in society management, which may make the critiques of China's unique politic system outdated and not applicable.

Internet is so important that people coined "Digital Gap" to express the massive difference between societies with Internet and ones without. Fortunately, the world's largest group of people is desperate to embrace of the Internet, which may mean not only that the possibility of becoming a burden to other societies is lowered but also the possibility of making more contribution is increased.

Observing around the world, we may find that China's single huge market is much unique. With 1.3 billion people speaking the same language, sharing the same culture, and moving freely by the much advanced modern transportation system, connected by intelligent mobile devices that almost everyone has one China is not only the biggest Internet community but also a place where magical things happen.

People outside China can hardly understand that the online sales are more becoming the prevailing way of shopping. Chinese even invented online shopping festivals such as Double 11, in which day the online payment can reach about 100 billion RMB yuan only for one of many e-commerce websites.