ABSTRACT：This paper acknowledges and discerns the ever evolving Digital Economy, the primary focus being the impact Digital Economies have on a developing countries economy. The researcher uses a quantitative approaching in way of method of collecting the data, with the purpose of illuminating if third world countries such as Kenya should in fact invest more into said technologies. International organizations and government policy-makers acknowledge that scarcity of technology, particularly digital economy, affects economic growth of country in the contemporary world. Scholars investigating the linkages between the digital economy, and economic growth or development of a country, have created a substantial debate in the subject. This thesis investigates The Impact of Digital Economy on the National Economy of Third World Countries focusing on Kenya. A structured society assessment methodology is used to analyze how implementation of digital economy interact with contextual conditions and institutions to stimulate economic growth. The lack of political will, weak institutions, and inadequate government response are critical factors in the implantation of digital economy and its performance. Without effective interventions, third world countries country will continue to lag behind in digital economy. Strong governance and institutional capacities to cope with the ever-changing modern technology such as digital economy are essential now and in the future. 

Key words: Digital Economy, Kenya, developing countries economy, third world countries

Table of contents-II

1 Introduction-3

1.1 Background-3

1.2 Background of the Study-4

1.3 Statement of the Research Problem-4

1.3 Aim of the Research-6

1.4 Organization of the Thesis-6

2 LITERATURE REVIEW-7

2.1 Evolution of Digital Economy-7

2.2 Assessing Digital Economy-8

3 RESEARCH METHODOLOGY-10

3.1 Introduction-10

3.2 Documentary Analysis-10

3.3 PESTEL Analysis-10

4 Analysis of digital economy in Kenya-12

4.1 Introduction-12

4.2 Geographical and Historical Factors of Kenya-12

4.3 Brief History of digitalization in Kenya-13

4.4 Political Will of Government-14

4.5 Economic Situation of Kenya-15

4.6 Social Aspects of Kenya-16

4.7 Technology in Kenya-17

4.8 Legal Framework-18

5 Conclusion-20

References-23