The Digital Revolution and The Digital Divide

Over centuries, the world has experienced a few industrial revolutions amongst which the recent one witnessed can be termed as a digital revolution – computers, cell phones, internet, various forms of electronic social media and so on.  In fact, Figure 1 also shows that compared to the other technological advances, the speed at which the digital revolution has entered our life is just mind-boggling. For example, in the United States, it took cars more than 80 years to reach half of the country’s households, but for cell phone, it took less than ten years. Just two years after Apple shipped the first iPad, it sold 67 million units. It took 24 years to sell that many Macs, 5 years to sell that many iPods and more than three years to sell that many iPhones.

Adoption of new technologies in the United States

The pace of digital revolution is illustrated in Figure 2 for Internet use and mobile phones. Not only is the change substantial and adoption is widespread. In 2015, there were more than 7 billion mobile subscriptions, 2.3 billion people on smartphones and about 3.2 billion people connected to the Internet. Of the mobile phone users, 49% were using smartphones in 2015.

Digital technology penetration around the world between 1995 and 2015

In recent years, the digital revolution has accelerated the global production of goods and services, particularly digital trade (Figure 3). In 2014, global trade in goods reached $18.9 trillion and trade in services $4.9 trillion.

The digital revolution, the global production of goods and services, and digital trade

The knowledge-intensive portion of global flows increasingly dominates—and is growing faster than—capital- and labor-intensive flows. Today knowledge-intensive flows account for half of the global flows and are gaining share: Knowledge-intensive goods flows are growing at 1.3 times the rate of labor-intensive goods flows. As a result, the digital components of goods and services flows have also increased (Figure 4). Indeed, many products today, as demonstrated by the “app economy,” are entirely virtual. Much of the data pass through the Internet, often on smartphones.

The digital component of global flows has increased—selected examples

The current digital revolution presents unique challenges and opportunities for human development. It has changed people’s lives in every aspect – e.g., work, innovation, interaction, knowledge, business, to name a few. The digital revolution deserves attention in its right, but also because of the way it is changing human life and living.
The spread and penetration of digital technologies are changing the world of work everywhere, but the effects vary across countries according to their own social and development contexts. Some technological changes are cross-cutting, such as information and communication technologies and the spread of mobile phones and other handheld devices. Still, countries will continue to have different production and employment structures and different uses for digital technologies, mainly reflecting the relative economic weights of agriculture, industry, and services, as well as the resources invested in developing people’s capabilities. Labor markets, the ratio of paid to unpaid work and the predominant types of workplaces in each country differ—so the impacts of digital technologies on employment will vary accordingly.
The digital revolution may be associated with high-tech industries, but it is also influencing a whole range of more informal activities from agriculture to street vending. Some may be directly related to mobile devices. In Ethiopia, farmers use mobile phones to check coffee prices. In Saudi Arabia, farmers use wireless technologies to distribute scarce irrigated water for wheat cultivation carefully. In some villages in Bangladesh, female entrepreneurs use their phones to provide paid services for neighbors. Many people sell phone cards or sell and repair mobile phones across developing countries.
Mobile phones now facilitate many aspects of work through a combination of voice calls, SMS, and mobile applications. Some uses of mobile phones in agriculture are shown in Figure 3. But there are also benefits for many other types of activity, formal and informal, paid and unpaid, from food vendors in Cairo to street cleaners in Senegal to care providers in London. Mobile phone-based economic activity is likely to keep expanding rapidly. In Sub-Saharan Africa, individual mobile subscriptions are predicted to rise from 311 million in 2013 to 504 million in 2020.
The digital economy has enabled many women to access work that applies their creativity and potential. In 2013, about 1.3 billion women were using the Internet. Some have moved to e-trading as entrepreneurs, and some are employed through crowd working or e-services. But this new world of work puts a high premium on workers with skills and qualifications in science and technology, workers less likely to be women.
But one has to recognize that in spite of all the successes of the digital revolution, its promises for human well-being remains unfulfilled because of a digital divide. Even though the digital revolution has contributed substantially to human development, access to the digital revolution remains uneven, constraining the even more significant effects it could have on human lives.
Developed and developing countries: In 2015, 81% of households in developed countries had Internet access, compared with 34% in developing countries and 7% in the least developed countries.
Urban and rural areas: In 2015, 89% of the world’s urban population had 3G mobile broadband coverage, compared with 29% of its rural population.
Women and men: In 2013, 1.3 billion women (37%) and 1.5 billion men (41%) used the Internet.
Young and old: In 2013, people ages 24 and younger accounted for 42.4% of the world’s population but 45% of Internet users. In 2013 two-thirds of Twitter users aged 15–25.
Website content production: This is dominated by developed countries, which in 2013 accounted for 80% of all new domain-name registrations. Registrations from Africa were less than 1%.
Broadband coverage and variations in access to computers and smartphones could generate new forms of exclusion. Inexpensive and reliable access to the Internet is becoming imperative and constitutive for driving capabilities in other areas, such as education, work, and political participation. Access to information is crucial for high-quality education, and thus for expanding opportunities for children and youth. The biggest challenge is to make these benefits available for all people, everywhere. The digital divide, however, continues to impede universal benefits and could push those who are already deprived in other areas further behind.
Less than half the world’s population (47%) uses the Internet. In the Americas and the Commonwealth of Independent States, two-thirds of the population is online. In Europe, the rate is 79%. In contrast, only around 42% of the people in Asia and the Pacific and the Arab States are connected, and just 25% of those in Sub-Saharan Africa are users. So even though mobile subscriptions and connections in Sub-Saharan Africa are predicted to nearly double between 2013 and 2020 (Figure 5), the question remains who would benefit from it?

Mobile subscriptions and connections in Sub-Saharan Africa, 2013 and 2020

Prices in many regions make connecting prohibitive. Prices for basic mobile or fixed broadband plans, for example, are much higher in less developed countries than in the developed world, and they are highest in LDCs (Figure 6). But even in developed countries, there are digital divides.

Prices for Internet access in PPP$, 2015

To uphold standards of universalism, and to fully benefit from the opportunities that digital revolution holds for human development, striving for universal access to the products of such revolution may be in order. Combined with access to high-quality education, such universal Internet access could significantly increase opportunities and reduce inequalities everywhere.

By Selim Jahan
Director and Lead Author
Human Development Report

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