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Paths to Cultivate Data Providers and Third-Party Agencies

Jan 31-2024   



In a paper published by Social Science Journal, the authors Huang Zhuo and Zhang Xiaodong explore paths for fostering data providers and third-party professional service agencies. Huang Zhuo is NSD Associate Professor and Fashu Scholar, and Zhang Xiaodong is Ph.D. of Applied Economics and Associate Fellow with PKU Changsha Institute for Computing and Digital Economy (ICODE).

 

Data providers and third-party agencies comprise a fast-growing industry which hosted 1.92 million firms by November 2022. A deeper look reveals that the central and western regions of China have a disproportionately low share of the industry; that most firms are concentrated in business areas with low entry barriers; and that there is a relatively small number of small and medium-sized enterprises.

 

The authors analyze the scopes of data providers and third-party agencies and apply an optimized Electronic Data Interchange (EDI) framework to construct dynamic mechanisms for the two. They also sum up the experiences of the US in growing data brokers and of the European Union in developing data intermediary service providers.

 

They then offer advice to cultivate data providers and third-party agencies. Mid- and western regions of China should create a positive policy environment by strengthening policy support, lowering market entry barriers, and enhancing firms’ intentions to join the industry. To facilitate the growth of data delivery service providers and data governance service providers, fiscal funding mechanisms should be improved and a multi-layered fintech supporting system should be erected promptly. In addition, rules and regulations should be perfected to safeguard the healthy operation of the data factor market and lower transactional and compliance costs for companies. In this way, the industry will be better positioned to attract more small and medium-sized enterprises. The authors also advocate for souping up the computational capability of companies, especially by allocating subsidies or giving favorable treatment to help small and medium-sized enterprises access computational resources.

Paths to Cultivate Data Providers and Third-Party Agencies

Jan 31-2024   



In a paper published by Social Science Journal, the authors Huang Zhuo and Zhang Xiaodong explore paths for fostering data providers and third-party professional service agencies. Huang Zhuo is NSD Associate Professor and Fashu Scholar, and Zhang Xiaodong is Ph.D. of Applied Economics and Associate Fellow with PKU Changsha Institute for Computing and Digital Economy (ICODE).

 

Data providers and third-party agencies comprise a fast-growing industry which hosted 1.92 million firms by November 2022. A deeper look reveals that the central and western regions of China have a disproportionately low share of the industry; that most firms are concentrated in business areas with low entry barriers; and that there is a relatively small number of small and medium-sized enterprises.

 

The authors analyze the scopes of data providers and third-party agencies and apply an optimized Electronic Data Interchange (EDI) framework to construct dynamic mechanisms for the two. They also sum up the experiences of the US in growing data brokers and of the European Union in developing data intermediary service providers.

 

They then offer advice to cultivate data providers and third-party agencies. Mid- and western regions of China should create a positive policy environment by strengthening policy support, lowering market entry barriers, and enhancing firms’ intentions to join the industry. To facilitate the growth of data delivery service providers and data governance service providers, fiscal funding mechanisms should be improved and a multi-layered fintech supporting system should be erected promptly. In addition, rules and regulations should be perfected to safeguard the healthy operation of the data factor market and lower transactional and compliance costs for companies. In this way, the industry will be better positioned to attract more small and medium-sized enterprises. The authors also advocate for souping up the computational capability of companies, especially by allocating subsidies or giving favorable treatment to help small and medium-sized enterprises access computational resources.