Digital Economy And Income Inequality essay

At present, we have devoted an effort to describe the impact of Information and Communication Technologies on income distribution in Thailand. Some concepts have aroused as Digital Development, Information Society, Knowledge-based societies, Network Societies… And above all, the needs to make the evolution of these theoretical constructs measurable.

This effort has served many purposes, being the more relevant explaining what was the impact of Information and Communication Technologies (Sits) on Thailand (b) measuring this impact c) designing policies to foster positive impacts while reducing negative Beyond – or within – general theoretical approaches, applied ones models have been built to identify the core aspects that made up a particular understanding of the interaction of Sits and Society, and tried to draw the relationships amongst these aspects.

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In some cases, the translation of these issues into specific indicators made possible the measurement of the evolution of the digital economy – as understood by each model and the establishment of relationships of cause within models, relationships upon which policies were to be built. In the following pages we identify and analyze what have been the main models to quantitatively describe and measure the digital economy, understood as the results of the process of digitization of society and its economy, and the prior or first stage upon which more complex theories are based upon.

First, we focus on the theoretical and methodological proposals for modeling the digital economy. We are particularly interested in their conceptual approach, although some of these models have been applied also in surveys and assessment When not applied, these models have framed future understandings and designs of ore practical models. We secondly switch to cases of actual implementation, that is, sets of indicators and composite indices aimed at measuring the development of the Information Technology.

We have deliberately set aside public policies to promote the digital economy for two main reasons. The first one because we want to be as close as possible of what has been really done and not what was said that was going to be. The second one is because the results of these policies must be properly measured to realize their real achievements; in doing so – measuring – we see tacit models merge from daily practice. It is thus by approaching the tools that we can proxy and infer the actual models implemented.

Definition of “The Digital Economy’ First Of all, before being preoccupied with the impact Of the digital economy on income distribution in Thailand, we would like to present some formal definitions of this term that we gathered from various sources in order to shed light on your vision and broaden your perspective toward this issue… “… The Digital Economy – is defined by the changing characteristics of technology, information, computing, and communications – is now the reinvent driver of economic growth and social change.

With a better standing of these fundamental transformations, we can make wiser decisions – whether we are investing in research, products, or services, or are adapting our laws and policies to the realities of a new age… ” – Neal Lane, Assistant to the President for Science and Technology, April 1 999 “… The Digital Economy refers to a set of qualitative and quantitative changes that, in the last 15 years, have transformed the structure, functioning, and rules of the economy.

It is the knowledge and idea-based economy where the keys to job reaction and higher standards of living are innovative ideas and technology embedded in services and manufactured products. It is an economy where risk, uncertainty, and constant change are the rule, rather than the exception – The united Nation Conference in 2000 “… When we talk about The Digital Economy, we are talking about a world in which people work with their brains instead Of their hands.

A world in which communications technology creates a global competition not just for running shoes and laptop computers, but also for bank loans and other services that cannot be packed into a crate and shipped by utilizing new concepts and ethos rather than new machines. A world at least as different from what came before it as the industrial age was from its agricultural predecessor. A world so different its emergence can only be described as a revolution… Spencer Regis, the contributing editor at Wired Magazine of the United States Consequently, from many frames of minds toward this term, we can definitely summarize that “The Digital Economy’ is an economy that its new systems and processes are based mainly on computers, the information technology, the Internet, and wisdom. Besides, this term refers specifically to the recent ND still widely unrealized transformation of all sectors of the economy by the computer-enabled digitization of information.

The digital economy also becomes a generator of the new business and wealth creation at present. Comprehensive Model of ‘The Digital Economy’ The next point that we must explain before moving on further to our topic is the comprehensive model of “The Digital Economy”. Thanks to Small Pea-Lopez, lecturer and researcher of University Oberon De Catalonia (CHOC), the model that we meticulously selected and presented below is the most clear-cut and perfect paradigm to understand the factors of the digital economy. The crucial composites of the whole system are… ) Infrastructures The main function of infrastructure is to enhance the smoothness of content and services’ flow by utilizing three major components which are connectivity, hardware, and software. 2) CIT Sector This part is concerned thoroughly with sectors using three major components of the infrastructure mentioned previously in order to bring about the optimization of resources. 3) Digital Literacy “Digital Literacy’ or “Digital Skills” includes technological and informational literacy, and especially CIT driven training for better capacity. Gal Framework This is about regulations and restrictions on the digital economy 5) Content and Services These are the finalist uses of the technology. Differences between “Old Economy’ and “Digital Economy” ISSUE OLD ECONOMY DIGITAL ECONOMY Economy-wide Characteristics: Markets Stable Dynamic Scope of Competition National Global Organizational Form Hierarchical, Bureaucratic Networked industry: Organization of Production Mass Production Flexible Production Key Drivers of Growth Capital/Labor Innovation/Unknowing Key Technology Driver Mechanization Digitization Source of Competitive Advantage

Lowering Cost Through Economies of Scale Quality, Time-To-Market, and Cost Importance of Research/limitation Low-Moderate High Relations With Other Firms Go It Alone Alliances And Collaboration Workforce: Policy Goal Full Employment Higher Real Wages and Incomes Skills Job-Specific Skills Broad Skills and Cross-Training Requisite Education A Skill or Degree Lifelong Learning Labor-Management Relations Adversarial Collaborative Nature of Employment Marked by Risk and Opportunity Government: Business-Government Relations Impose Requirements Encourage Growth Opportunities Regulation

Command and Control Market Tools, Flexibility Resource : A similar set of Old and New Economy characteristics has also been developed by John Doer, of Klein, Perkins, Coalfield & Byers (Menlo Park, California). So far, it has been many aspects of differences which continuously occur between the old economy and the digital economy. Here is the table presenting the lists of those differences… As you can see from above, there are many changes due to the impacts of digital economy.

The Recent Situation of Global Digital Economy According to “digital economy rankings”, or previously known as “e- deadness rankings” of 201 0 issued by the Economist Intelligence Unit, Sweden is at the first position from 70 countries taking parts in the ranking race. Undoubtedly, the reason for the success of Sweden is that the country has high levels of connectivity, stable states of business operations, and positive legal environments.

Furthermore, strong educational and cultural drivers which are supportive government CIT policies and growing use of digital services by individuals and businesses also trigger the strong digital development progress in Sweden according to Denis McCauley, the Economist Intelligence units Director of Global Technology Research. The outstanding fact reveals that Finland, Taiwan, South Korea, and Japan had made powerful advances; as a consequence, this also shows that the qualities of Asian broadband start to catch up with and compete against Europe and North America.

The standards for ranking are listed at the table below. Scoring criteria categories and weights Category Weight Connectivity and tech oenology infrastructure Business environment 15% Social and cultural environment Legal environment Government policy and vision Consumer and business adoption Source: Economist Intelligence unit, 2010 For Thailand, however, from 2009 to 2010, the rank is unchanged at 49th, the total score declined slightly from 5. 00 in 2009 to 4. 86 in 2010.

In our view, there is still a huge challenge for Thailand in the global stage for extracting the benefits from digital technology The key implications from this survey are presented as follows: Nordic countries have been improved in most digital economy areas: Sweden this year is leader, Denmark, albeit by a narrow margin. Finland and Norway are also among the top six digital economy countries in 201 0, the former advancing six places mainly on the strength of improved performance in indicators measuring the use of online services.

Ass’s digital leaders overcome the rest on quality: Taiwan, South Korea and Japan all advanced strongly in the rankings, partly thanks to high scores relative to the rest of the world?in broadband and mobile “quality”. Their high fiber density, for one, is testament to these countries’ ability to execute on their digital agendas. Broadband is more affordable across the globe: In 49 of the 70 countries in the rankings, the monthly fee charged by the main broadband provider mounted to less than 2% of median monthly household income in 2009.

This was the case in 42 of the 70 countries in the 2009 study, and only 33 countries in 2008. Affordability has advanced strongly in developing countries such as Vietnam and Nigeria. The evidence confirms that the digital divide is narrowing: Where 5. 9 points (on a 1-10 scale) separated the top-ranked country from that of the bottom ranked in 2009, the gap narrowed to 5. 5 points in this year’s study. This is partly due to the above-cited model changes which, in “raising the bad’, have had a larger dampening effect on the scores of top-tier countries than on hose further down.

As in the case of broadband affordability, however, lower tier countries are making up ground in a number of areas. Digital Economy Abroad Nowadays, both developed and developing countries are pushing their efforts and converting their visions in order to create new policies for dealing with the digital economy. The united States For 15 years, the digital economy has been already started and is believed that this is the major engine of economic growth at present. Due to its impacts, the volume of service sector has been increased while the proportion of manufacturing sector has declined.

Furthermore, the investment of the information technology has also escalated by both private and public sectors. The US government has launched dominant policies for promoting the role of information technology: “The National Information Infrastructure (MINI’ in 1992 and ‘The Global Information Infrastructure in 1994. Moreover, the government also paid attention to E-Commerce and tried to make the international trade to be in the global network form. The European Countries Internet is the main target for the economic development Of the European countries.

There are three purposes for targeting the Internet yester and accessibility: the efficiency, skill improvement, and legal environment. However, England is now facing the problem of how to deal with property rights with the digital economy Act. Asia There is an increasingly rapid development of Internet businesses in China. The pace of development has really been quickening as more and more of the population gain access to the Internet. China is the promising model of this region because of strong signs of being innovative.

Yet, controversial action by the Chinese government in respect of Internet companies such as Google, Yahoo! ND Microsoft continues to loom as problematic. Moreover, Singapore is performing well also by setting up new infrastructure and the Internet system. Africa There seems to be an unquestioned assumption that an African country (other than South Africa) would be the least likely candidate for a digital economy to emerge. According to the CIA World Fastback 201 0, the literacy rate in Kenya stands at 85. 1 % (compare to Nigeria: 68%; Burning Fast: 21-8%).

In Africa, only South Africa has a higher literacy rate (86. 4%). Internet penetration in 2009 was estimated at 8. 6%; I. E. Roughly 3. 6 million users. Furthermore, unlike e-governance, an emerging digital economy does not require that a majority of citizens are connected in order to thrive. Latin America and Caribbean Many of the changes that have recently taken place in Latin America and the Caribbean in terms of trade liberalizing and the modernization of telecommunications, places the region in a good position to embark upon its transition to information-technology and knowledge-based society.

The outstanding example of this region that can perform well is Chile. However, the region’s marked social segmentation and high level of poverty and social exclusion are causes of concern, as is its very limited institutional capacity for defining and regulating proprietary rights and the social obligations of the agents who hold such rights. Middle East Mobile commerce is potentially important for a wide range of industries, including telecommunications, IT, finance, retail and the media, as well as for end-users.

Jordan and Dublin have developed as the Middle East region s major bases for web-based businesses and services but Saudi Arabia, home to around one in seven Arab Internet users, is the region’ s most important market. Australia and Oceania This region is rapidly adopting technology and taking up the new opportunities to connect, collaborate and transact more effectively. Many businesses are incorporating the digital tools necessary to make their business more productive and efficient, and support new business opportunities. Digital Economy in Thailand Now, lets put the digital economy of Thailand in your perspective for deeper insights.

There are many striking events that help result in the transformation of the economic system throughout decades. “Computerizing”… Firstly, in 1963, “Computerizing” had struck and caused numerous changes when Thailand started using computers mainly for research and development purposes (R&D). The first kind of computers settled at the faculty of commerce and accountancy of Clangorous University at that time is IBM 1620. Afterwards, IBM 1401 is used for demographic observation at the national statistical office of Thailand also. Later on in 1964, computers became prevalent and were used for business and financial purposes massively.

The obvious examples of this phenomenon are The Siam Cement Group and Bangkok Bank. 10 years later, computers were transformed into minicomputers and installed at the Stock Exchange Market of Thailand in order to facilitate the financial transactions and enhance the efficiency of the operation. Furthermore, for small businesses, minicomputers are modified further into microcomputers which were widespread in 1979. Computerizing benefits not only for business and economy but also for education. To illustrate, many schools and universities have used computers for teaching processes since 1983. Internet Revolution”… Thailand has started using the Internet since 1 987 by connecting minicomputers between Prince of Seasonal University collaborating with Asian Institution of Technology (TIT) in Thailand and Melbourne University in Australia through the wires. At that time, the information was transferred very slowly and just temporary. In 1992, the National Electronics and Computer Technology Center (NEGLECT) conducted the connectivity of six institutions including Clangorous University, NEE-CUTE, Prince of Seasonal University, Tamaris University, and Assets University together.

This event created “Thai Social/Scientific Academic and Research Network” (THESPIANS). Then, the Internet services were kicked off for commercial purposes for the first time in 1995. Until now, computerizing and Internet revolution have been developed mutinously and lead to new information technology and electronic commerce (E-commerce) which can help stimulate the economic growth and productivity of the country consecutively. Thai government actions also reinforce those benefits by setting up the National Information Technology Committee since 1992.

Digital Economy and Income Inequality in Thailand Exactly, in the digital economy, there is a complex relationship between technological growth and employment, but no previous technological innovation matches the power and potential significance of the IT. This is leading to broad concern and debate about the potential impact of the digital economy on income distribution especially in Thailand. In the Elicited States, many researchers are cynical. For example, from one article, “[Promoters] say the [information] highway will be paved with jobs.

Yet how is it that every week a phone company or computer company announces massive layoffs? ” (Notwithstanding the difficulties some companies experience in weathering the first restructuring of the new information technology sector, the data show that this industry is the engine of economic growth and high-paying, high-value jobs. Hence, the inspiration sparked up in our minds and thoughts in order to investigate the case of Thailand whether those quotations really hold.