The World Bank’s World Development Report 2016 looks at Digital Dividends. It explores the impact of the internet, mobile phones, and related technologies on economic development. The Report lists digital dividends as growth, jobs, and services. It explains how digital technologies help businesses become more productive; people find jobs and greater opportunities; and governments deliver better public services to all.
By reducing information costs, digital technologies greatly lower the cost of economic and social transactions for firms, individuals, and the public sector. They promote innovation when transaction costs fall to essentially zero. They boost efficiency as existing activities and services become cheaper, quicker, or more convenient. And they increase inclusion as people get access to services that previously were out of reach.
The Report lists the dividends of digital technology as follows:
It goes on to point out that these dividends are not as widespread as expected because:
- Nearly 60% of the world’s people are still offline and cannot fully participate in the digital economy. There also are persistent digital divides across gender, geography, age, and income dimensions within each country.
- Some of the perceived benefits of the internet are being neutralized by new risks, such as vested business interests, regulatory uncertainty, and limited contestation across digital platforms, leading to harmful concentration in many sectors.
Moreover, quickly expanding automation, even of mid-level office jobs, could contribute to a hollowing out of labour markets and to rising inequality. And the poor record of many e-government initiatives points to high failure of ICT projects and the risk that states and corporations could use digital technologies to control citizens, not to empower them.
There is an interesting graphic of a typical day in the life of the Internet, which clearly tells you that even with extended connectivity, only a miniscule minority of the 40% of the world’s people who are on-line, are using the internet to its full potential:
The Report concludes that enhanced connectivity is vital, but not enough to realize the full development benefits. “Digital investments need the support of analogue complements: regulations, so that firms can leverage the internet to compete and innovate; improved skills, so that people can take full advantage of digital opportunities; and accountable institutions, so that governments respond to citizens’ needs and demands. Digital technologies can, in turn, augment and strengthen these complements—accelerating the pace of development.”
As is its wont, the World Bank seeks solutions from governments and its institutions, never asking essential (if embarrassing) questions about the social milieu where development is a desired objective.
Take the case of India, where for millennia, society has been divided along caste, class, ethnic and religious lines, and where access to the basic elements of development – such as education and health – is often decided by one’s social status, often ascribed by birth and therefore immutable. The digital divide so clearly visible in India cannot be bridged without tackling the underlying social and economic divide throughout the country.
So perhaps a government given to pithy sloganeering should first promote a casteless India, an equitable India, an educated India, a healthy India and only then look for a digital India. Or failing that, leave behind a legacy of greater inequality, greater marginalisation, concentration of wealth in fewer and fewer hands, and greater social malaise, intolerance and deprivation than it inherited from its predecessors…