Digital Divide - Impacts - Economic Growth

The digital divide, represented by uneven access to ICT inputs and outputs such as scientists, IT specialist or computers and mobile phones could lead to a widening economic divide between industrialised and developing countries (Campbell, 2001). The outputs give rise to greater flows of information, resulting in higher economic growth. Evidence shows that durable productivity gains have been greatest in enterprises in which ICT use has been greatest (Bresnahan, Brynjolfsson and Hitt, 1999). On average, Countries in which ICT were most widespread reported the greatest growth in multi-factor productivity in the late 1990s.

In theory, ICTs should lead to positive economic outcomes by making markets more transparent through greater access to information, and more efficient through the resulting decline in transaction costs. Therefore the economic growth of a country is directly affected by the Internet infrastructure within that country. Wealthy countries which can afford better telecommunications can conduct business better with the rest of the world, thus contributing to the country’s GDP. A World Bank study maintains that as much as one half of the difference between Africa's manufacturing exports as a share of GDP and the much higher east Asian share may be caused by the former's poor telecommunications (World Bank, 2000). Evidence for Botswana and Zimbabwe shows that areas without access to telephones and the internet have substantially less entrepreneurial activity. A similar study states that: 'areas with high levels of resources and skilled labor but with lower levels of telephony have fewer 'productive enterprises' (as cited by Robison and Crenshaw in Campbell (2001)). This suggests that it is quite plausible that countries with poor access to ICT are poorer in turn as a result: a good telecom infrastructure is not only the outcome of economic growth, but is an input to growth as well.

See also

• Digital Divide – Background - Philips Young
• Digital Divide – Dimensions - Income - Meredith Sydes
• Digital Divide – Dimensions - Rural & Metropolitan Areas - Meredith Sydes
• Digital Divide – Dimensions - Age- Jamie Dair
• Digital Divide – Dimensions - Culture - Nicole Davidson
• Digital Divide – Dimensions - Infrastructure - Nicole Davidson
• Digital Divide – Dimensions - Educational Attainment - Meredith Sydes
• Digital Divide - Access - Ownership - Nicole Davidson
• Digital Divide - Access - Race - Nicole Davidson
• Digital Divide - Impacts - Social and Civic Involvement Opportunities - Philips Young
• Digital Divide - Bridging the Divide - Improving Access - Dane Allen
• Digital Divide – Bridging the Divide - Education and Development - Dane Allen
• Digital Divide – Bridging the Divide - Regulation - Dane Allen
• Digital Divide - Bridging the Divide - Development or Dependency? - Dane Allen
• Digital Divide - Bridging the Divide - The Role of Private Interests - Dane Allen
• Digital Divide - Education Opportunities - Philips Young
• Digital Divide - Education and Employment Disadvantages - Nicole Davidson
• Digital Divide - Employment Opportunities - Philips Young
• Digital Divide - Digital Divide in Australia - Meredith Sydes
• Digital Divide - Australia's Telecommunications and Globalisation - Meredith Sydes
• Digital Divide – Proponents of importance of Digital Divide - Jamie Dair
• Digital Divide – Proponents of unimportance of Digital Divide - Jamie Dair

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References

• Campbell, D.(2001) 'Can the Digital Divide be Contained?', International Labour Review. Geneva vol.140, no.2, pp. 119-141.
• Bresnahan, T., Brynjolfson, E.and Hitt, L.M. (1999) 'Information technology, Workplace Organization, and the Demand for Skilled Labor', Working Paper No. 7136. Cambridge, MA, National Bureau of Economic Research.
• World Bank (2000) The networking revolution: Opportunities and challenges for developing countries, Global Information and Communication Technologies Department, viewed 6 September 2005 <http://www.infodev.org/library/ working.htm>

World Bank. 2000. The networking revolution: Opportunities and challenges for developing countries. InfoDev Working Paper. World Bank Group, Global Information and Communication Technologies Department. Washington, DC, June. Available on www.infodev.org/library/ working.htm. --Philips young 10:56, 28 Oct 2005 (EST)