The Digitalization Paradox: A Systematic Literature on The Impact of Digital Transformation on Wealth Inequality Within BRICS Nation

Abstract

While the scholarly field of digital inequality continues to expand in diverse directions, the intricate relationship between digital disparities and traditional forms of wealth inequality has yet to be fully addressed. Wealth inequality is a multifarious challenge driven by structured factors such as education gaps, income inequality, usage patterns, unemployment, and unequal access to investment opportunities. This research highlights the key importance of understanding how income inequality, financial inclusion, and employment trends influence the overall wealth distribution within the BRICS nations (Brazil, Russia, India, China, South Africa (2010), Egypt (2024), Ethiopia (2024), Iran (2024), Saudi Arabia (2024), United Arab Emirates (2024), Indonesia (2025)). The methodology of this study utilizes a systematic literature review of modern investigation and a theoretical investigation. By combining existing literature, this paper discusses key actual observations and offers exhaustive explanations for the shifting economic landscape. The objective of this study is to investigate the impact of digital innovation and financial development on wealth inequality in BRICS countries. The results within this research paper suggest that, contrary to initial expectations of two digital leveling, technological innovation often increases wealth inequality within the BRICS countries. The finding indicate that the “digital divide” is no longer merely a matter of hardware access or “who has a phone”; instead, it has evolved into a gap in how individuals leverage digital tools to generate and accumulate wealth. The study concludes that to mitigate the inequality, policymakers must move beyond basic connectivity. There is a need to ensure the equitable distribution of wealth, stabilize the macro-economy, and strongly develop the digital skills of young entrepreneurs. Furthermore, strategic investment in financial technology must be balanced with inclusive regulatory frameworks to enhance sustainable economic growth across the BRICS nations.

Keywords: Digitalization, wealth inequality, investment, unemployment, economic growth, financial inclusion, digital divide, BRICS countries, technological innovation, systematic literature review