Decades ago, every economy depended on industries such as construction or agriculture. However, with the advent of technology, many new industries emerged, with companies being focused on the provision of services based on digital platforms. Nowadays, the media economy plays a role in Gross Domestic Product (GDP), which helps not only contribute to the output increase but additionally globalization influences. However, due to the decrease in income from the media industry, the influence of the media economy does not have as powerful an impact on GDP as it used to have.
Levels of Media Economy
The first area to address is the most important level of the media economy and here, it is necessary to stress the individual level. The study of the media economy uses ideas, notions, and fundamentals from both macroeconomic and microeconomic points of view to examine how media companies and sectors operate at various tiers of activity (Albarran, 2016). More individual empowerment and media consumption options are on the rise. The perspective to consider here is the fact that the individual level implies a customizable approach to information dispersion. Although many seniors may favor a conventional television set, younger viewers who have become accustomed to online browsing and file-sharing are perfectly comfortable viewing information on a mobile device (Albarran, 2016). Therefore, in the evolving media economy, the individual controls their information consumption, such as what they are looking for, when they want the information, and the way they desire to receive it (Albarran, 2016). Given its adaptability, the individual level is in this instance the most significant one of the media economy.
Forces Impacting the Media Economy
Another point to consider is the most prominent force impacting the media economy, which might be globalization. Globalization can be considered a significant force behind the media economy, which is based on the transmission of information (Albarran, 2016). For instance, the United States exports more media output than any other country, which helps the companies in this nation thrive and have an influence on other nations (Albarran, 2016). The acquisition of additional assets by businesses in other nations additionally contributes to globalization. When a business opens many sites in other countries, it engages in an additional kind of globalization (Albarran, 2016). For instance, Disney has theme parks in a number of significant international locations (Albarran, 2016). As a result, the power of globalization can be seen through its possibility to permeate other countries, influence people, and increase revenue.
Media Industries and a Nation’s GDP
Finally, considering such an influence of the media economy on GDP, authorities should not only focus on this area. In the United States, the media sector accounts for 1.86% of the GDP, which is comparable to certain other critical economic sectors, such as construction, 3.7%, and agricultural production, 1.6% (Albarran, 2016). Yet there is no denying that the pace of increase in media income has slowed throughout the period under consideration, and people may anticipate that the pattern will persist. Due to growing fragmentation and technological pressures, one would anticipate a further fall in the media/GDP ratio in the US (Albarran, 2016). Therefore, investing in the media economy instead of focusing on real output can be detrimental to GDP.
Conclusion
Hence, with the decline in media sector revenue, the media economy’s influence on GDP may not be as strong as it once was due to the continued advancement of technology. With its flexibility, the individual level is the most significant level in the media economy. The ability of globalization to influence individuals, penetrate other nations, and generate revenues shows its strength. Finally, the GDP may suffer from investments in the media economy rather than actual production.
Reference
Albarran, A. B. (2016). The media economy. Routledge. Web.