Can the Digital Divide be Closed?

I think the answer to this question depends a lot on how one defines the digital divide. Consider two examples:

* A country with US$30 K per capita GDP, growing at 2 percent per year, spending a constant 7 percent of GDP on ICT;
* A country with US$1 K per capita GDP, growing at 5 percent per year, and increasing percent of GDP spent on ICT by 0.2 percent per year (from a base of 5 percent).

The increase in ICT spending per capita per year would be:

* US$42 per year in the first country
* US$4.50 per year

Some would say the poorer nation was catching up in per capita GDP and in portion of GDP spent on ICT and thus the digital divide between the two countries was decreasing. I would say the rich country was increasing spending on ICT nine times faster than the poor country, and the digital divide was continuing to increase.

I have in various places tried to make the point that you have to look at the elasticity of different kinds of ICT expenditures. There is only so much people will spend on transistor radios and television sets. When rich people have as many as they want or need, and poor people are buying more, eventually the divide in penetration of those devices can be expected to close. (Of course, in rich countries people may be using large-screen, flat-screen, high-density TV to view expensively produced content, while in poor countries people may be using TV made with older, less expensive technology to view less expensively produced content.)

On the other hand, rich countries have a lot more money than poor countries to spend on ICT, and they often spend a larger portion of GDP on ICT than poor nations. They do so by spending much more on high end technology -- microchip manufacture, computer aided design and manufacturing, command and control systems, supercomputer applications, and computer modeling. I think the propensity to consume such goods and services increases with increasing income, while the propensity to consume transistor radios saturates and eventually decreases with increasing income.

The divide in access to radio broadcast is (I think) largely gone -- although there remains a gap in access to radio content in local languages in Africa and Asia). The divide in access very high performance computers is growing, as Japan and the United States invest in every higher performance machines, and the developing nations have almost no supercomputers at all.

In terms of poverty reduction, the important digital divide is in terms of access to the most cost-effective technologies for reduction of the worst aspects of poverty. Thus I think I would be most concerned about access to radio-disseminated public health messages or access to telephone services from villages in poor nations. I think generally all countries agree that it is important to overcome the worst aspects of poverty, and thus they are willing to see strong efforts to overcome the digital divide in such low-end technologies.

In terms of economic competitiveness in an increasingly globalized economy , technologically advanced countries are doing everything that they can to maintain a competitive advantage in international markets for high technology goods and services -- to increase or at least maintain the digital divide in high-end technologies.