Part 1 page 28

In India, with more than a billion people, had only 56 million cellular phone users at the
end of 2004. However, since the 1990s’ economic reform and further deregulation of
telecommunications in the first decade of the 21st century, the Indian government has
opened telecommunications to an unprecedented degree of private and foreign
participation. In 2003, the share of the Indian population with cellphones was 2 percent
compared to 20 percent for China. With competitive expansion, “customers can get most
[telecom] services they want dirt cheap” in India, making it “one of the world’s hottest
markets for telecommunications handset makers, equipment suppliers, and investors,”
according to the Wall Street Journal reporter Joanna Slater. Subscribers to mobile phones,
which just surpassed those to mainline phones in India in 2005, are expected to reach
more than 130 million by 2008. China also has expanded its Internet phone service,
hoping to leapfrog Western landline telephones.

Part 2
Jeffrey Sachs Director of Columbia University’s Earth Institute contends: “Today’s world
is divided not by ideology but by technology,” the digital divide between rich and poor.
Fifteen percent of the world’s population, most of the OECD countries (including
South Korea) plus Taiwan, are technological innovators, identified as those countries
with 10 or more patents per million population. About 50 percent of the world, with at
least 2 percent of GDP being high-tech exports, are technological adopters. Adopters
include northern Mexico, Costa Rica, Argentina, Chile, Tunisia, South Africa, Israel,
India (except the Ganges valley states), Singapore, Malaysia, Indonesia, Thailand, coastal
China, the Baltic states, Russia (in a narrow strip near St. Petersburg), plus OECD
countries New Zealand, Spain, Greece (north-eastern), Poland, Czech Republic, Slovak
Republic, Hungary, Slovenia, Romania, and Bulgaria. The rest of the world is
technologically excluded, according to Sachs. Their greatest problems are “tropical
infectious disease, low agricultural productivity and environmental degradation, requiring
technological solutions beyond their means”

-Technology adoption refers to the process of accepting, integrating, and using new
technology in society.

Part 3 rapid ICT growth

In 1965, Intel’s Gordon Moore coined Moore’s law, envisioning the doubling of computer
capacity and the halving of computer and software prices every two years. The radical
miniaturizing potential from nanotechnology, with millions of transistors on the head of a
pin, could continue this trend throughout the early years of the 21st century. Pohjola
(2001:13), who uses “hedonic price indices that take account of each year’s improvement
in the performance of computing equipment,” shows that the price of personal computers
declined 18 percent yearly from 1958 to 1994, necessitating a log scale to show these
price reductions in a single graph. Indeed, according to Pohjola, if technical progress in
the automobile had proceeded at an 18 percent annual rate after invention, the price of a
car today would only be $5!
- ayon kay Pohjola, kung ang teknikal na pag-unlad sa sasakyan ay nagpatuloy sa 18
porsiyentong taunang rate pagkatapos ng pag-imbento, ang presyo ng isang kotse ngayon
ay magiging $5 na lamang!
Part 4
In 2001, the world information technology expenditures (computer hardware and
software, data communications equipment, and computer services) were about $2,000
billion, about 1/20th of 1 percent of world gross investment. In the same year, high-
income countries had 396.9 Internet users per 1,000 people, with middle-income
countries 36.8 and low-income countries 6.4. The proportion of people with computers
that same year showed somewhat comparable ratios: 416.3 per 1,000 in high-income
economies, 35.4 in middle-income economies and 6.1 in low-income countries (World
Bank 2003h:300). Figure 11-2 shows that, among LDC regions, Latin America and the
Caribbean leads with 59.3 personal computers per 1,000 people, while at the bottom are
sub-Saharan Africa, with 9.9, and South Asia, with 5.3, per 1,000.

Part 5
Table 11-1 indicates that, in 2001, Japan spent more on information and communications
technology (ICT) per capita, $3,256, than any other country, with the United States
second with $2,923, Denmark third with $2,912, and Sweden fourth with $2,804. Among
those listed, low-income economies such as Indonesia (17), India (19), and Vietnam (26),
spent least on ICT per capita.

Part 6
In 1998, almost half ICT imports by OECD countries were from non-OECD countries,
primarily in Asia (OECD 2000). A number of LDCs have high ratios of high technology
exports (much from foreign investment) to total manufactured exports.

Bangladesh cellular phone technology and the Middle Eastern Virtual Souk have
empowered artisans and petty traders, indicating that some LDC poor are reducing the
digital divide. More over the internet, which its low entry barriers, is providing
alternative sources of information, overcoming the restrictions of the national and
international press, radio and television. Better communication increases the incomes and
information of poor and middle-class people, reducing the digital divide.

Part 7
Investable resources can be used in a number of ways: to build steel mills or fertilizer
plants, to construct schools, to buy computers, to expand applied research, to train
agricultural extension agents, and so on. And because there are not enough resources to
go around, we must choose among investments. The rest of this chapter indicates how we
can make these choices in an economically rational way.