Updating technology third world country
Because of its large English-speaking population, India switched from computers to software and services whereas Brazil and Mexico companies exited quietly.
Taiwan and China traditionally have been workshops for the multinationals, but China’s Lenovo and Taiwan’s Acer have risen to number two and three in the global computer hardware industry.
” They cited reports of international agencies (OECD, UNESCO and the United Nations), which argued that some computer activity was appropriate for developing countries and these countries should be actively engaged in seeking how to make use of computers for their situation.
They also noted that although some officials in developed countries felt that developing countries should focus on more urgent, basic needs such as food, health and poverty, officials in developing countries rejected this view because they regarded computers as stepping stones to social and economic development.
However, there is a side of production that is close-to-use (Figure 1), which has proven valuable for some developing countries even though Gotlieb and Borodin did not specifically identify it at the time– the development of packaged software and information services.
Domestic companies in such as India, Brazil and Mexico succeeded for a while in their own markets, but could not compete globally with the multinational brands or their own white box makers.
The academic implication is that the impact of IT on productivity is expanding from the richest countries into a large group of developing countries.
The policy implication is that lower tier developing countries can also expect productivity gains from IT investments, particularly through policies that support IT use, such as greater openness to foreign investment, increased investment in tertiary education, and reduced telecommunications costs.
IT Production versus use Gotlieb and Borodin’s 1973 caution that most developing countries should focus on computer use rather than production was wise, and prescient.
Many countries have sought gains from investments in IT production rather than IT use, but the research shows that there are gains to the whole economy from investment in IT use rather than gains to only a single industry sector from investment in IT production.