Digital platforms have altered trade patterns so that it is no longer confined to the transfer of tangible goods by advanced economies, but more countries and smaller enterprises can participate.
In this March 2016 study, McKinsey Global Institute analyzes the shift in global economic trading trends away from traditional flows of goods, services, and finance and towards digitalization. Global trades in goods rose from 13.8 percent of world GDP in 1986 to 26.6 percent in 2008. Shortly after the sharp decline and rebound of the Great Recession, goods trades has been growing more slowly than world GDP. However, while the volume of global flows of goods has declined, the flow of data has surged, primarily consisting of information, searches, communications, transactions, video and intracompany traffic.
Digitalization has also allowed trade to be conduct online. Approximately 12 percent of the global goods trade is conducted via international e-commerce, through platforms such as Alibaba, Amazon and eBay. Trade can also be instantaneous through goods such as eBooks, MP3 music finals, apps and cloud computing services.
Prior to digitalization, globalization was driven almost exclusively by governments, large multinational corporations and financial institutions. Now, artisans, app developers, freelancers, and entrepreneurs can use digital platforms to access global markets. Small and medium sized enterprises (SMEs) are using Internet platforms to put themselves in front of a global customer base and become exporters. For example, Facebook estimates that 50 million SMEs are on its platform, up from 25 million in 2013, and on average 30 percent of their fan base is from other countries. Of 271 startups interviewed worldwide, 86 percent of survey respondents pointed to at least one cross-border activity. Almost two-thirds have customers or users in other countries, and almost half reported sourcing talent from other countries. Individuals are making an impact in globalization as well. An estimated 914 million people around the world have at least one international connection on social media, and 361 million participate in cross-border E-commerce.