Abstract

In the modern world, the growing importance of networks has changed the source of competitive advantage. This paper investigates this transformation through a comparative case study of Walmart and Amazon, examining how the two firms achieve success under different economic conditions. Walmart’s experience displays how low prices, physical scale and efficiency create dominance through traditional market competition, while Amazon reflects how a firm utilizes digital platforms and network effects to connect consumers and sellers at an unprecedented scale. However, while these powerful technologies create invaluable benefits, they also cause new economic problems, including misinformation, information asymmetry, and inequality. This essay identifies digital literacy, data openness and digital infrastructure as possible solutions to the problem. As AI makes information and routine tasks increasingly abundant, many traditional human interactions are replaced, while those unreplaceable human qualities such as trust, creativity and empathy become more valuable.

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