BRIDGING THE GLOBAL DIGITAL DIVIDE

I have been reading Jeffrey James new book by that title, and it seems worth the attention of the Knowledge for Development community. At US$65, the book seems priced high for its 129 page length, but the content is interesting.

I want to address a couple of issues in the introductory section of the book. (I may come back to the book for future postings as I read more.)

The book starts with a discussion of the fact that most ICT R&D is funded in rich countries, for products aimed at the fat markets of those countries. James feels, as do I, that there is not enough R&D focused on providing ICT appropriate to the needs of the poor in developing countries.

James notes the brain drain, focusing on the tendency of people trained to do ICT development in developing countries, migrating to rich countries to work on R&D for their markets. I have suggested that there may be a “virtual brain drain”, in which the best ICT developers in poor countries can now stay at home, and via telework, work as if they we physically present in rich countries. My wife, for example, managed a project for our local government here in Maryland, in which Indian software developers created a platform for an aspect of the local e-government services. The communication was done via the Internet. Of course the job generated income for India, but the benefits accrued primarily to the government in Maryland, and the Indian programmers that could have developed software for Indian government, did so instead for U.S. government.

James also discusses the evidence that technological innovation is responsible for much of economic growth. This of course has been the subject of previous postings on this blog, as well as a of a highlight on the Development Gateway, and many other publications.

I think James’ approach is perhaps too dependent on economics and not sufficiently oriented to overall policies and institutions. Technological determinism seems to me not to recognize that war, insurrection, terrible government, failed government, corruption, and other problems plaguing the poorest countries have a huge affect on their development progress, and are not amenable to technological solutions.

James’ also seems unaware of theories of “induced innovation”. These theories suggest that technological change is induced by economic growth. I think induced innovation makes a lot of sense. Countries with good economic performance get to invest more money, and thus to refresh human and physical capital more often. They are seeing wages increase, and labor to capital costs shift; consequently, they will be expected to shift the technologies to more capital, less labor intensive technology. Innovators making such changes will be rewarded, and the innovation process should be reinforced.

In short, countries that get the policies, prices and institutions right in order to stimulate and sustain economic growth should see that growth induce more technological innovation.

I think that in the right circumstances, both processes take place: economic growth induces technological innovation, and technological innovation induces improvements in productivity and products that stimulate economic growth.

If in fact this kind of circularity does take place, it creates a problem of econometricians. Both processes suggest a correlation between rates of economic growth and of technological innovation. Econometrics then has to use more elaborate models, with very difficult to find data, to tease out the relative importance of each process. Techies are blessed with an easier task – innovating where the circumstances permit.

James also treads into economic waters in which I would fear to go. He looks at the convergence versus divergence debate, and comes down on the side of divergence – that the distribution of wealth in the world is becoming ever wider. Others suggest that the economic success of India and China, when weighted by the huge populations of those countries, requires just the opposite interpretation – that the poor are on the average coming closer to the rich in wealth and income.

Still another line of argument suggests that money is not good for judging development, and that the gaps in life expectancy, hunger, basic education, and other indicators of the quality of life are decreasing. I admit to liking these arguments, in the sense that they suggest that the gaps in health, food, agricultural and other technologies relating to basic human needs may be shrinking, while the gaps related to luxury consumption may be increasing.

I wish James good luck with his arguments, but I feel that it is abundantly clear that we need to develop appropriate information and communications technologies for developing nations, and to develop and disseminate the innovations that apply those technologies to reducing poverty. The economic arguments are important to convince the policy makers, perhaps, but folk who understand the power of the technology and the needs of poverty will have no doubts about the right thing to do.