How can you get more economic growth out of your ICT? Take care of your digital divide Alain BOURDEAU de FONTENAY Columbia Institute for Tele-Information (CITI) Fernando BELTRAN University of Auckland ACORN/REDECOM Conference2009, Mexico City, 4-5 September 2009
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How can you get more economic growth out of your ICT? Take care of your digital divide
How can you get more economic growth out of your ICT? Take care of your digital divide. Alain BOURDEAU de FONTENAY Columbia Institute for Tele-Information (CITI) Fernando BELTRAN University of Auckland ACORN/REDECOM Conference2009, Mexico City, 4-5 September 2009. Objective. - PowerPoint PPT Presentation
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How can you get more economic growth out of your ICT?Take care of your digital divide
Alain BOURDEAU de FONTENAYColumbia Institute for Tele-Information (CITI)
Fernando BELTRANUniversity of Auckland
ACORN/REDECOM Conference2009, Mexico City, 4-5 September 2009
Outline Background to the digital divide debate ICT and economic growth Poverty and inequality: is it efficient? Chronic poverty and inequality: what might
make it sustainable? What to look for when formulating a pro-
growth digital divide policy?
Why a digital divide policy? The primary rational for a digital divide
policy might be: Social equity A vision of society (Gore 1996) More efficient delivery of government services Economic efficiency (Mueller 2001)
Here, we are concerned with economic growth, hence economic efficiency
President Clinton and I… challenged the nation to ensure that all of our teachers and students have access to modern computers and engaging educational
software… We challenged the nation to make sure that our children will never
Definitions A digital divide policy has to be evaluated in terms of its specificity in time
and space, e.g., Keniston and Kumar’s (2003) four divides: 1. “The first divide is… between
those who are rich, educated, and powerful, and those who are not…
2. A second digital divide… is linguistic and cultural… It separates those who speak English…
3. The third digital divide… is the gap between the rich and the poor nations…
4. … in countries like India and America, yet a fourth: the emergence of a new elite group,… the beneficiaries of the enormous successful information technology industry and the other knowledge-based sectors of the economy such as biotechnology and pharmacology….”
“inequalities in access to the Internet, extent of use, knowledge of search strategies, quality of technical connections and social support, ability to evaluate the quality of information, and diversity of uses”
Identify useful parameters to assess ICT’s effectiveness
What are their relevance? Mueller (2001) – Is broadband access a consumption
good or an infrastructure? What is the scope of the digital divide, e.g.,
A technology? Are dimensions such as “social exclusion” relevant to
economic efficiency? Is DiMaggio et al.’s (2004) definition too broad/narrow to
look at economic efficiency? What is the relevant time dimension from a policy
perspective? To what extent might dimensions such as political power,
culture, institutions, and local specificity be relevant?
The digital divide & growth: the impact of poverty AF is Solow’s technical change AL is the labor-specific technical change
Unskilled labor is primarily associated with poverty, hence, potentially with the digital divide. The digital divide, if it exists would correspond to frictions in the labor market
associated with poverty. Growth might be achieved through
improvements in: Low skilled labor participation, NUSkilled Ability to benefit from technical change, AUSkilled
Observation: inequality Decreased in the middle of XXth century Generally increased since the ‘70s
Increased inequality: Generally attributed to technological change, but why long
run? Some suggest ICT is a GPT
Very long time impact on labor force Skilled labor force is a complement Unskilled labor force a substitute Limited wage flexibility of low wage worker
Potentially: low skilled workers might become permanently unemployable
Poverty is undesirable, hence the haves have The incentives to restrict upward mobility-based
competition by the higher abilities have-nots. More resources to block competition due to their higher
wages, e.g., through being in a better position to: Manage information Manage the political process (Buchanan) Control the allocation of public resources (e.g., education,
security) Hence, a greater ability to achieve mobility foreclosure
Affirmative action (Franke 2007) A way to better implement legislations and regulations, e.g.,
Gender-based (Gayathri 2005) …
Challenge - How to formulate a pro-long run growth strategy to go from the digital divide to the promotion of digital opportunity?
Inequality is largely sustained through social discrimination buttressed by institutions, what digital divide strategy can best address those problems?
The window of opportunity is limited in time (McSorley 2003)
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