miércoles, 17 de diciembre de 2014

Extractive elites and the #digital revolution in Europe

Second post written while I'm reading "Why nations fail?". The better the reading is an essay the more applications of it you find to the world you live. One of this application are to identify the extractive elites you can find around the digital economy. As in the period of the industrial revolution, you can identify two kind of extractive elites. On one hand, those who try to stop the revolution in order to maintain its privileges. On the other hand, those who win a dominant position and fight to avoid having limits to their power

It is well known that Europe is lagging behind in the digital revolution. There are documents written on the other side of the atlantic that blames on the excessive regulation for this delay. In my opinion is not the lack of regulation what it is failing, but our failure in bridling the two kind of elites described above. Up to the date, this have not been possible. Nevertheless, it looks now that it exists a light of hope for Europe.

The first kind of extractive elite has as its main interest maintain the digital economy as a marginal part of our economic system. The main strategy of this group is diverting investments to other kind of infrastructures different to the digital infrastructures. This elite was highly successful in 2013, when they managed to reduce the CEF budget for digital investment to a mere 0,3% of this EU program (1 € billion of 30 € billion). It looks its power has fortunately decreased. Andrus Ansip, the EU Digital Single Market Commissioner has announced he aims 10% of the new EU investment Plan for growth. If he reach this objective, a critical battle would have been won. The amount of money foreseen to be dedicated to digital projects in the new EU investment plan is a sign of its decreasing power.

The second kind of elite is composed by those who was the first to jump on the digital vagon and has grown up to the status of quasi-monopolies. There are few differences between the "Robber Barons" of the 19th century and the great internet companies of our era. Our "Digital Robber Barons" have reached a monopoly in different kind of e-businesses (search, e-books, social networks, ...) , and they threat to extend this monopolies to new industries (mobile, robots, ...). It looks that the only solution as in the past is breaking-up this companies. The fact that the European Parliament has started to think in breaking-up Google are good news

Extractive elites was as dangerous in the past as in the future. As it is showed in "Why nations fail?", Europe has been quite successful up to the date to limit their power in each juncture of history. We are now in another critical point of history where Europe Institutions has to prove its value to defeat the new kind of extractive elites.

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