The economy of development

Economics

Economy of Development

This report aims to discuss the effects of technology on the development and economies of third world and emerging nations. The focus is on but not limited to the topics of health, standards of living, and wealth. There has been a growing trend towards social, financial and technological globalization since the middle of the 1980's. This movement can be distinguished by a surge of new technological breakthroughs by the various industrial nations and through the less developed ones. It is assumed that these technological advances can be associated with high growth rates and increases in standards of living, but the trend seems to imply the opposite. Many of the developing countries have experienced both long and short-term collapses in growth rates as well as a significant numbers of outright financial crises with direct and indirect macroeconomic and social issues. As pointed out by Thomas R. DeGregori in his 2001 book entitled the Environment, Our Natural Resources and Modern Technology, there are many preconceptions and cultural myths about the environment, natural resources and technology and these myths are extremely distorted. Thus, the third world and emerging nations have become victims of many wrong doings. Therefore, this report examines how technology does not adequately reach the poor in the less developed nations of the world.

Even in a time when computers and the Internet could easily elevate the poor nations of the world, they are not getting their fair share of the twenty-first century's technological boom. Globalization and the many technological breakthroughs in social, business and economic realms should benefit everyone on the planet but this is not the case. For example, the Gross Domestic Product of the world's countries helps monitor what is occurring in the various economies. The United States recent eighteen month forecasts for the Gross Domestic Product has been increasing at a clip of just under two point seven percent (2.7%) annually. This is a good pace until we note that in comparison, the combined first world nation's Gross Domestic Products have been estimated to grow at an even higher pace of over three percent (3%) annually. Yet, third world nations in many cases continue to have declining Gross Domestic Products while the first world industrialized nations exploit their resources and opportunities. As DeGregori points out, wildlife conservation efforts in Africa for instance continue to destroy many of the homogeneous cultures and therefore force the natives from their lands while also depriving them of even the basic foods. In South America the rain forest is being decimated and in Africa forests are also being cut down at unbelievable rates. "While there is no doubt that all three processes are taking an increasingly heavy toll on the forest and woodland areas of sub-Saharan Africa, there is considerable controversy over the exact rate at which this is occurring. Estimates based on the subjective judgment of experts or on data from low-resolution sensors on weather satellites are generally higher than those based on the more accurate data from high-resolution sensors on the Landsat and Spot satellites." (Mabogunje)

There is no doubt that these natives are also denied access to modern technologies and that is somehow supposed to ensure that they remain 'authentic' despite these irreversible segregations and intrusions. Some technologies and inventions have an instant and dramatic effect on all levels and classes of a society in regard to social, cultural and economic advancements. It is quite obvious that technologies such as the telegraph and the telephone sped up economic development of rural communities similar to how the laying of cross continental railroads altered the nations of the United States and Russia. Today, networking and computing have become but one aspect of the many new available technologies. Prior to today's complex information systems, computers were single or 'dumb' terminals that had to be connected to complex mainframe machines. Only the most wealthy nations and businesses utilized these tools. This changed as technology advanced. "All this has to be compared with IBM's punched-card products, where a single range of machines (the 400 series accounting machines) satisfied all its customers. The resulting rationalization of production processes and standardization of components had reduced manufacturing costs to an extent that IBM had no effective competition in punched-card machines at all." (Aspray and Campbell)

But today, networks that encompass many individual workstations and are many times more powerful than the mainframes of only a few decades ago have become affordable by any standard. Networks have become a standard feature in virtually all technology rich environments throughout the world and these networks can now all talk to one another which has resulted in the internet.

How new innovations like the internet are shared by all however, is a big concern for lesser economically capable nations. "The rich industrialized countries contain less than a quarter of the world's population but consume over three quarters of the world's goods. The standard forecasts looking toward the twenty-first century project an even more drastically skewed distribution. For if the world's population growth continues to be concentrated in the poor areas of the globe, as it has been since World War II, and if it continues to outstrip the economic development of these areas, as it did during the 1970s and 1980s, it is highly probable that by the year 2000 the economically underdeveloped countries will contain as much as four-fifths of the world's population but will have to support them on as little as one-sixth of the world's product." (Brown, 1996, p. 74) in regard to the blatant social and cultural segregation, modern technology has in effect created a state known by many in the economic profession as a 'digital divide'. Technology has literally created a global state of 'haves and have not's and over the next two decades or more, these have not nations will find themselves falling even more seriously behind the first world. One clear example of the 'digital divide' that will last well into the future can be demonstrated by a basic like internet access in schools.

In the United States, the internet can be used by all of society. Consider that the government, healthcare, all industry, the educational process and almost the majority of private citizens have access to the internet. This example holds true for every other first world nation. In the have states, the Internet has changed the economic lives of everyone. Any third grader in the United States can now acquire facts about Hermit Crabs or any other bit of information in the same way that a millionaire, a congressman, a doctor, a lawyer or a mother. The advent of the internet has literally connected people all over the world and thus helps to better prepare them for the future.

It would then seem obvious that putting computers in Third World or less developed nation's schools would also enhance the quality of life for the poor. Consider Africa; the Internet would enhance the community's schools, healthcare facilities, governmental operations and rural farms. In other words, it would raise the potential of all these levels of people. Of course, a large number of third world countries are connected to the Internet, but the majority of those connections are accessed via satellites which capture Internet transmissions and systematically relay them back to the United States for processing. These connections are also not usually made by the average Third World citizen. "But, except for some large cities, the land mass of Africa is likely to be untouched by an information highway for a long time to come. Villagers of rural Africa have so little spending power that they are of little interest to the big players of the information highway." (Afemann, 2004)

In the First World, we assume the entire world has the basic needs to utilize the Internet already in place. "There are three pre-conditions for using Internet. First you need a phone connection, second a computer and a modem and third electricity." (Afemann, 2004) the Third World, unfortunately, does not have these basic necessities for the bulk of its citizens. The basic dilemma is apparent if one recalls Maslow's Hierarchy. People who cannot feed themselves do not put a priority on the luxury of electricity. It is apparent that in order to have electricity, a stable power supply system is needed and many third world nations especially those in two thirds of the African continent, the majority of the populations are living in undeveloped rural areas so there are no adequate power supplies -- and, Africa is not alone. "Also on the Indian subcontinent more than half of all houses in rural areas lack any power supply." (Afemann, 2004)