Essay on Digital Dividends

By | July 17, 2020
Essay on Digital Dividends

Today we discuss on Digital Dividends. Let’s read Essay on Digital Dividends.

Digital Dividends

There is no doubt about the fact that information and communications technologies (ICTs) have benefited businesses, people and governments. Last few decades have seen rapid spread of digital technologies the world over.

However, broader development benefits from using these technologies or digital dividends lagged behind, especially in the developing world. The boost in growth, opportunities and service deliveries has been uneven. It can be safely said that while digital dividends have been immense, on the one hand, the digital divide has not reduced, on the other hand.

As per the World Bank’s World Development report 2016, “to get the most out of the digital revolution, countries need to work on the “analogue complements”—by strengthening regulations that ensure competition among businesses, by adapting workers’ skills to the demands of the new economy, and by ensuring that institutions are accountable.”

Here are some statistics: (i) six billion people do not have access to high-speed broadband internet; (ii) nearly two billion people do not have a mobile phone; (iii) three times more citizens use online services in the richest countries than in poorest.

No doubt, the digital revolution has spread quickly and even the poorest of poor today own a mobile phone—ironically, they do not have access to clean water, electricity and proper housing, which is more important to improve their quality of life. There is definitely a disconnect in the way the economic planning in many countries is being done.

Easier communication, more information sources, etc. has not generated digital dividend in the form of faster growth, more jobs and better life. Businesses are more connected than ever before, but global productivity growth has slowed.

Labour markets have become more polarized, and within-country inequality is on the rise in many countries. “These trends are worrying not because they are caused by the rapid spread of technologies, but because they have persisted in spite of them.”

According to the World Bank report, there are two major reasons for this anomaly. First, nearly sixty per cent of the world population is not participating in the digital economy. Second, some of the benefits are being offset by emerging risks.

Need for strong analogue foundation: There is urgent need today to close the existing digital divide to take full advantage of the opportunities that the digital technologies offer. Besides, education, social protections and needs of the labour market need to adapt to the new world of work that demands different skills and more flexibility.

The governments also need to improve service provider management, as also increase citizen voice. “Where the public sector accountability is low, digital technologies often help control rather than empower citizens,” says the report.

The World Bank report suggests that important analogue complements need to be strengthened by the governments to decrease the digital divide—regulations that allow firms to connect and compete; skills that technology augments rather than replaces; and institutions that are capable and accountable.

Countries with low internet access need to create conditions for greater adoption and use. Fundamental barriers like lack of basic ICT and excessive regulation should be removed. Education system also needs to be geared to provide knowledge about digital technologies at very basic levels.

Countries transitioning to a digital economy with fairly high technology use need to ensure that opportunities are open to all. They should also ensure development of regulations that open protected sectors and strengthen enforcement. The education system also needs to be tweaked to prepare young population for career development instead of specific jobs.

Countries that have already transformed into digital economies need to ensure that digital platforms do not abuse their dominant position and that fair competition is promoted between offline and online services.

“Connectivity for all” remains an important goal and a tremendous challenge. Countries that will build strong analogue foundations will reap ample digital dividends—in faster growth, more jobs and better services.

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