1. ICTs, Economic Growth and Digital Divide Technology by itself is not a solution to any development problem; it only provides an opportunity (Pohjola, deputy director of the WIDER -World Institute for Development Economics Reasearch-, 2002)

2. 1) ICTs: a great opportunity ICT empowers, benefits and links people all over the world... access to the digital opportunities, must therefore, be open to all (G8 Countries, 2000) The development and the spread of ICTs have often been considered as a huge opportunity for developing countries to close the technological and economic gap with the developed ones. 3. 1) ICTs: a great opportunity Why should the economic gap be reduced? Because, according to Mansell (2001), ICT should: reduce the firms' costs of setting up reduce the costs of economic transations empower the firms' general efficiency improve the bargaining power of producer firms Repositioning of emerging firms in the global value chain 4. 1) ICTs: a great opportunity According to many scholars, developing countries should benefit from ICTs adoption much more than the developed ones, so the gap should be reduced or even closed. Panagariya (2000) even suggested that: Given the costs savings offered by the Internet technology and relative ease with which it can be provided, they [the developing countries] can now skip several stages of technological development through which developed countries had to go. 5. 1) ICTs: a great opportunity However, already in 2000, Mansell notes that there is no evidence that the direct relationship between diffusion of technological innovations and macroeconomic growth in developing countries produce an effective reduction of the gap. So... ...Is the gap really closing? 6. 2) ICTs diffusion and empirical evidence In a recent study (2010), Hilbert, Lopez and Vasquez took into account the situation of the OECD countries and the countries that make up the so-called LAC (Latin American Countries). GOAL: studying the situation in order to obtain information about the performance of the economic and technological gap; trying to understand if the gap is closing or not. The data show very interesting growth rates about the spread of ICT in the two different areas, over a period of time ranging from 1996 to 2006. 7. 2) ICTs diffusion and empirical evidence The data observed in the LAC area are valid for almost all the developing countries in the world. So, at a quantitative level, the gap seems to go to an early closure: if the rates of adoption of innovation should continue to be like the ones shown, in a short period of time the difference would no longer exist. ...BUT... 8. 2) ICTs diffusion and empirical evidence At this point in their work, not satisfied with this result and considering that conclusion "liar", Hilbert, Lopez and Vasquez decided to take a step back and dwell on the concept of technology. ICT, in fact, are sets of technologies even before media. So they list three basic characteristics of ICT in terms of technology, three distinct dimensions of information processing: 1. Storage 2. Computation 3. Transmission / Communication So the analysis moves to a more qualitative level. 9. 2) ICTs diffusion and empirical evidence At this point, the three authors have estimated the capacity of storage, computation and transmission in the two macro-areas over a period of time between 1996 and 2006. The results completely delete the idea of a digital divide in danger of extinction". The following graphic is pretty clear about it... 10. 2) ICTs diffusion and empirical evidence If you imagine to extend the two curves in the following years following the same inclination, it is evident that the gap is widening, contrary to what was observed by considering the simple data about access to ICTs. The problem, considered not only in quantitative terms but also (and especially) in qualitative terms, offers a more realistic and disillusioned view of the current situation. 11. 3) ICTs: a lost opportunity? The empirical evidence does not yet provide a basis for concluding that the new digital opportunities offer long- term economic gains for most developing countries. The availability of the Internet will not reduce bareers to international trade if electronic commerce implementation replicates the distribution of the traditional market power. 12. 3) ICTs: a lost opportunity? Even though there are examples of countries in the developing world who are benefiting from the adoption of ICT, in most cases, the conditions for economic development that can truly bridge the gap continue to lack. The benefits that Mansell had predicted for developing countries did not occur or, at least, not fully. But why?? 13. 3) ICTs: a lost opportunity? Pohjola (2002) identifies three possible explanations to this phenomenon: 1) Less wealthy states have invested less in ICT; in particular, no one has invested as the U.S. 2) Even if they have invested, they have not invested in education and skills of use 3) The problem may be on the demand side, not on the supply side 14. 3) ICTs: a lost opportunity? Considering the third explanation offered by Pohjola, we should notice the fact that a lot of factors (some of which are non-economic and non-technological) come into play in the diffusion of ICT and, consequently, in the possible reduction of the economic gap and the digital divide. 15. 3) ICTs: a lost opportunity? The main factors on the demand side are: Income Culture Level of Education Job / Main occupation Openness to innovation Skills of use 16. 3) ICTs: a lost opportunity? But also on the supply side there are non-economic and non-techonological factors that affect economic development related to ICTs adoption: National policies Openness to innovation Human capital Culture Infrastructures 17. 4) Final observations The data show that in recent years the impact of ICT has been very strong on the U.S. economy and, secondly, on the European Union, but much less evident on other countries. If we study the problem not only with a quantitative approach, but also with a qualitative approach, it seems increasingly clear that ICT are failing to bridge the economic gap. There are a lot of different factors that affect economic development, so it's really difficult tu fully understand all the dynamics involved. 18. 4) Final observations Anyway, we can state that, until now: ICTs have not fully bridged the digital divide within developing countries and between developing countries and developed ones ICTs have not fully closed the economic gap between developing countries and developed ones The debate about ICTs diffusion and its effects on economy and society is still OPEN!! 19. Bibliography Hilbert, M. [2010], Information Societies or 'ICT equipment societies'? Measuring the digital information-processing capacity of a society in bits and bytes, in The Information Society: An International Journal, 26 (2010), pp. 157-178 Mansell, R. [2001], Digital opportunities and the missing link for developing countries, in Oxford Review of Economic Politicy, vol. 17, n 2, pp. 282-295 Pohjola, M. [2002], The new economy in growth and development, in Oxford Review of Economic Politicy, vol. 18, n 3, pp. 380-396