miércoles, 1 de junio de 2016

Digitalisation is reinforcing unbalanced growth

Digital globalisation is beginning to show its socioeconomic effects. In spite of its global positive effects, there are signs of a growing divide within and between nations. Digitalisation looks as the source of growth of the enlargement of traditional economic divides. Beyond neoludism, it is time to review some facts and analysis that corroborate this hypothesis.

Let´s start with the digital divide within nations. Both in the developed and developing countries, exclusion is highly linked with unemployment. According with a recent article of the Harvard Business Review, the future will not bring us the end of work but an evolution of the labour market. The less-skilled jobs will be replaced by digital-skilled jobs. Therefore, the digital divide will enlarge the divide between the upper and lower social classes, between those who have more chances of retraining and acquiring digital skills and those who not. The growth of job in some professions based on computer usage come at expenses of other occupations. And the job losses will appear in those professions traditionally occupied by lower social classes.

A similar enlargement of traditional divides is beginning to happen between countries. Just when offshoring and outsourcing were beginning to help developing countries to fuel its economies, digital globalisation is starting to change the rules. Smart manufacturing and data analytics are reducing the business advantage of offshoring jobs. The labour cost of a machine will be always lower than the cost of the cheaper worker. As a consequence, we can expect that some manufacturing activities will return to developed countries at the cost of developed countries. As within nations, the digital divide will enlarge the divide that already exists between rich and poor nations. Economic growth is highly dependent of data flows, and the vortex of data is the developed world.

In spite of the above landscape, few international commitments to fight the digital divide that have been made. Fortunately, it looks there is a change on trends. Only just a few months the UN declaration on the review of the implementation of the outcomes of the WSIS has recognised the importance of bridging any kind of digital divide and the link between digital and sustainable development.

An unbalanced growth has been in the past the source of tensions within and between nations. Digitalisation could be either a lever for harmonised growth or the tool for the enlargement of the legacy divides. Unfortunately, it looks the later is the path we have chosen.

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