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2% in a year if they were not to increase their employees. Furthermore revenue per employee would increase by 24.47%, gross income by 27.22%, and gross income per employee by 28.4%. The areas in which learning takes place then include selling, fulfilling customer requirements, and providing customer satisfaction to an increasing degree of excellence. This is done without increasing resources in terms of employees or capital.
In terms of structure and improvement, there are a variety of interacting layers in the digital media offered by Internet technology. Consulting, training and integration services are part of layer two, which interacts with IP-based networks and applications, that form layer 1. These layers interact with digital dot coms at layers 3 and 4, enabling them to provide media-rich content with continuous improvement as layers 1 and 2 continuously improve their products and services. In this way an entire network of learning and improvement relates to subordinate networks of dot coms in order to bring the best possible product to the consumer. Thus these networks become part of an endogenous system, as a rise in resources are not as related to economic growth as an increase of learning experience. A further manifestation of the learning experiences is alliances formed between content providers and electronic retailers to provide customers with bundled offerings that include a variety of products that are of value to consumers. The key appears to be in the integration of level 1 and 2 technologies in order to create the best products available. This accounts for the wide variety of products and services offered by dot com giants such as Google, Yahoo and America Online.
The integrated technology used by dot coms and others have been dubbed "General Purpose Technology" or GPT. This is global technology with a wide variety of applications that can be used by households, industrial communication and online stores. The use and manipulation of this widely applicable technology is then what makes dot coms potentially successful.
The failure of certain dot coms could then be said to be due to a lack of innovation and learning. The reason for this could be a tendency towards the exogenous paradigm, which is not suitable for the new technology. Indeed, the most successful dot com giants focus absolutely not only on integration with the various layers of Internet technology, but also endogenous elements such as integrating the newest innovations of communication as soon as possible. Rapid customer service is of the utmost importance in modern technology, and is second only to rapid innovation. The most successful dot com…
Economics of New Ideas and Innovations This research paper discusses the economics of a new idea. Without new ideas and inventions, the economy might very well become stagnant or decline, as predicted by many early economists, who did not understand that impact that ideas and innovative technology had on global markets. Technology is endogenous in the new growth theory, which holds that technology is a function of the capital and labor used
Growth Rate Slow model (1992) is an economic tool used to analyze a country economic growth. The principal conclusion of Slow model is that the accumulation of capital could not only account for the growth rate per person. To address the central question of economic growth, it is critical to move beyond the Slow model. Mankiw et al. (1992) incorporate economic tools such as FDI growth rate, trade, inequality, institutional quality
They buy more goods from local businesses, can afford more luxuries, and this encourages the growth of local enterprises. The spillover effect must be strong enough for this to work, however. Thus, it may be necessary for the government to fuel the economic development of local production through tax relief and to carefully select certain types of foreign investment to emphasize in its 'recruitment efforts' to ensure that the
) I will return to the strengths and limitations of growth accounting as a tool to use to assess the economic development of these nations below. Growth Accounting Growth accounting is an economic method designed to measure the relative and absolute contributions of different factors to economic growth and development. Developed by Robert Solow in 1957, this methodological approach disaggregates or decomposes the different elements of economic growth. The most important assumption
Private Sector Investment and Economic Development Investment and economic development The Role of Private Sector investment in Economic Development In the past few decades there has been overwhelming support for growth and development rooted in private investments and market-oriented strategies. A move from public sector driven growth has come as result of the need to reduce the widening gap in the balance of payment account, increasing public debt, rising inflation rate, growing foreign
404). They found that complexity especially in hierarchical organizations strongly determines success of design choice outcomes, especially when endogenous adaptation in different modules delivers "local performance improvement" (Ethiraj and Levinthal, 2004, p. 404). This is based on H.A. Simon's 1962 model of organizations, products and technology as complex, evolving systems where some choices constrain decision-making in the lowest levels, and also "near-decomposability" (Ethiraj & Levinthal, 2004, p. 404), the