ICT access: Worthwhile investment or waste of money?

According to Naomi Halewood and Charles Kenny, consultants to the World Bank, young people are most likely to adopt new technology – be it IT or communication technology. This view was confirmed by a study they conducted on the use of ICTs by young people in developing countries.

The main goal of the study was to discuss  youth access to and use of ICTs, opportunities presented by ICTs that might be particularly advantageous to young people, and suggest policy reforms that might maximise that benefit in developing countries.

Given the amount of media exposure and publicity being given to ICT development to Sri Lanka, it is worth asking whether ICT development can, and is having a significant impact on alleviating poverty conditions and contributing to the development of the country. While this study doesn’t look at the Sri Lankan context, per say, it can give us an idea of how successful other ICT projects have been – and what can be done to make it better.

Here is a summary of the main findings reported in the study:

1. How many young people use ICTs, and where do you they use them?

  •  Access to broadcast technologies (Television and radio) and telephony have been considerably more widespread than  access to the Internet. E.g. 80% of the population of the developing world listen to the radio at least once a week compared to computer penetration of 47 per 1000 people or 0.047%
  • The extent of Internet access and use differs widely between countries such as Chile and Sub-Saharan Africa. 62% of schools in Chile are online compared to only 7% in a sample of 8 countries in the Sub-Saharan African region.
  • The means of Internet usage differ between countries; while most have access through the use of a computer, a survey in China shows a considerable number of young people surf the Internet via a mobile phone.
  • Despite availability of public Internet access points in some countries, not many made use of them.

2. What do young people use ICTs for?

  • Primary usage of:
    •  Telephones – for contact between relatives and for emergencies
    • Broadcast technology – entertainment, with a secondary role for news on prices and services
    • The Internet – Check mail with a secondary role of finding information

3. ICT as a means for youth job creation and income generation

  • A number of young people are involved in selling scratchcards and time on phones
  • Business Process Outsourcing (BPO) is a big source of employment for people in India.
  • Programming and entrepreneurial sales activities through the Net

4. ICT as a resource for learning and education

  • Broadcast media have been use to communicate educational messages for older audiences on subjects such as HIV awareness and the like.
  • Sustainability of Internet access in school is a problem given the high cost per student per year of maintaining a computer lab

5. Political, social and cultural impacts of ICTs

  • ICTs are powerful tools for youth empowerment as one survey reports, with regular Internet users more likely to be involved in political campaigns, boycotts and petitions.
  • Negative social and cultural impact of ICTs include a preference for buying clothes as seen in music video, greater drug use , alcohol consumption and a greater prevalence of youth violence as seen on television.

6. Policy Conclusions

  • Despite social concerns, it appears ICT access and use can do a lot more good than harm. Hence appropriate policy prescriptions (private competition and regulation) should be in place in order to bring about further development in LDCs
  • Youth-centred policies should focus on ICTs access in schools, incorporating it into the curriculum and effective and appropriate training being given to teachers.
  • Efforts to curtail harmful content access on the Net could include ways to correctly verify the age of those seeking access to pornographic content and to develop content rating systems similar to movies.

So I guess the study answers our original question: improvement in ICT access and use is a worthwhile investment in the short and long run. However, what this study fails to identify is concrete data that shows how the improvement in ICT access has had on the actual living standards/salaries earned by those who use them. It seems only time will tell.

July 24, 2007 at 11:51 am 1 comment

China – the new America?

It’s interesting how in the span of less 12 hours, I’ve seen news articles, one claiming that China, a self-proclaimed communist country, is more capitalist than America is, and another stating that China is to overtake Germany as the third largest economy!

china.jpg

China’s landscape of high-rise buildings

According to the Gulf Daily News, China’s GDP rate is expected to be close to 11% by the end of this year, and has no expectation of slowing down. This is likely to surpass the GDP of Europe’s largest economy, Germany, in current US dollar terms, making it the third largest economy in the world. This has led to concern that overheating of the economy could lead to a possible financial crisis. The Central Bank have responded to these concerns, raising interest rates twice this year as well as bank reserve requirements and export curbs. However, if global demand for China’s manufactured goods remain as high as expected, there is little that the government can do about it.

I wonder if there is a correlation between the size of the country and its economic prosperity. Sure, the larger a country’s population is, the greater the likelihood of poverty being present. But it is fascinating at to how two countries with huge populations – China and India – are soon overtaking the world.

Could it be that in countries such as these, there are two extreme economic conditions that could exist – extreme poverty, or extreme wealth – and it is only a matter of time, as implied by the Solow Growth model, that poorer countries will catch up? I think it would be naive to make such generalizations. After all, tiny islands like Singapore are flourishing economically, but then again, they did have incredible leaders who strove to turn the once poor nation, into a Tiger economy. Nevertheless, it would be interesting to see if the size of a population in a country has an effect on economic prosperity, and if so, to what extent.

July 23, 2007 at 7:28 pm Leave a comment

The Rhino Problem

I spotted an interesting online blog entry made by Freakonomics co-author, Stephen J. Dubner today. It asked its readers to think up a solution to the following problem regarding wildlife conservation of Rhinos. I decided to have a go at finding a possible solution to the problem using the Economics I know up to now – feel free to leave comments on your views towards addressing the problem.

The main issue is deciding between funding conservation projects in Zimbabwe where the threat of extinction is more imminent but where corruption in the country is widespread, versus Botswana, a minimally corrupt country with poaching stresses being less high.

The first question I would ask is: for any dollar that is given in funding, how much of it is misused? Arguably, it would be quite difficult to find reliable data on this issue. However, if it is possible to get a rough estimate of how much aid was provided to each country in a given year and how much was actually used, this would give us a estimate- albeit a very rough one – as to what percentage of funds is actually used towards the betterment of society.

Next, it would be useful to determine the cost incurred per Rhino saved from extinction. This is a very ambiguous definition, but it could be calculated, using fixed, variable, tangible and intangible costs, to give a rough idea. An example of a cost incurred could be the expenditure on extra security in the form guards and technology, used to prevent poaching. This could give us an idea as to how many Rhinos can be saved per country per XX amount spent in funding.

Another issue that needs to be examined is the difference between poaching rates in the two countries. If differences are not large compared to the amount of money squandered, it may be a better idea to fund conservation projects in Botswana rather than in Zimbabwe.

A final note I might add is that it is not clear whether all the money has to be spent on one country or whether it can be divided among the two. If it can be divided, then the situation arguably gets more tricky. Comments?

July 23, 2007 at 6:40 pm Leave a comment

Freakonomics…?

Hello and welcome to the official blog of the RI Young Economists’ Association! Blog, you say? That’s right. For a while now, members have been discussing starting a website catered to the association. While this clearly isn’t a website, I thought it would be nice to create a blog whereby we can post interesting articles that we come across relating to Economics, Sociology or anything really that catches our fancy.

The idea entered my mind while browsing blogs of some of today’s leading economists. The main goal of this blog is to keep us up to date with what’s happening in the world today. Hence, feel free to send in links or articles or your own research so that it can be posted on this site. Remember, we want to keep this blog educational AND fun!

Enjoy!

P.S. Please feel free to leave comments on articles posted and any constructive criticism will be greatly appreciated!

July 23, 2007 at 11:08 am Leave a comment

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