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| THE FRICTION-FREE ECONOMY: AN INTERNET-BASED ECONOMIC PATTERN AND ITS IMPLICATIONS FOR INCREASING MARKET COMPETITIVENESS |
| ZHANG Jin-mei, MA Guang-qi |
1. School of Economics and Finance, Xi'an Jiaotong University, Xi'an 710061, China;
2. Institute of Finance, Fudan University, Shanghai 200120, China |
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Abstract This paper discussed the issue of friction-free economy by drawing insights from the latest relevant research findings that have surfaced on the international academic arena. The first part of the paper provides a general understanding of the new concept and its salient features. The so-called friction-free economy differs from its conventional counterparts. It counts as an entirely new economic pattern which is characterized by low cost, high efficiency and freedom from friction, as typically evidenced by the Internet-based economy. Then, the paper postulates that this up-to-date economic pattern not only poses severe challenges to the traditional economic theories but also produces a tremendous impact on social institutions, legal systems, governments and patterns of thinking. Importantly, this paper goes further to point out that the friction-free economic pattern sets higher standards for business operations and market competition. Finally, it draws some implications from the friction-free economic pattern and sets forth a number of strategies for enhancing business operations in the Chinese climate. Modern businesses are advised to comply with the principles under the friction-free economy and place much stress on the application of new technologies in order to modify their line of thinking about business operations and thus increase their market competitiveness.
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Received: 07 March 2004
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2004, Vol. 19 
