THE IMPACT OF NEW TECHNOLOGY ON THE DIGITAL ECONOMY AND ETHICAL CHALLENGES IN THE AGE OF ARTIFICIAL INTELLIGENCE

Abstract

The rapid development of new technologies such as Artificial Intelligence (AI), big data, and automation has changed the structure of the digital economy in Indonesia. These innovations have driven increased productivity, efficiency, and innovation in various sectors, but have also given rise to complex ethical and regulatory challenges. This study aims to analyze the economic and ethical impacts of AI implementation in Indonesia's digital ecosystem and identify strategies for building an ethical and sustainable digital economy. Using a qualitative approach through literature review, this study combines findings from various national and international journals, institutional reports, and policy documents related to AI governance and digital transformation. The results show that although AI contributes to accelerating Indonesia's economic growth, its implementation also raises issues such as algorithmic bias, data privacy violations, and technological access inequality. This study emphasizes the importance of strengthening the regulatory framework, improving digital ethics literacy, and collaboration between the government, the private sector, academics, and the community. In addition, sustainable digital economic development needs to be based on the application of ethical principles such as transparency, accountability, fairness, and environmental responsibility in every technological innovation process. This research contributes to the development of responsible innovation discourse by proposing a governance model that balances technological progress with social and moral responsibility. With this approach, Indonesia has the potential to become a pioneer in Southeast Asia in building an inclusive, ethical, and sustainable digital economy.