History has witnessed two industrial revolutions, each associated with a general-purpose technology -- a small group of technological innovations so powerful that they interrupt and accelerate the normal march of progress. The first was driven by steam, the second by electricity.
The third revolution -- the digital revolution has been unfolding over the last three decades -- driven by computers, information and communication technology (ICT) and networks. If directed towards expanding opportunities and building capabilities, the digital revolution stands to vastly improve people’s lives. There is the fourth industrial revolution (4IR) too. During 4IR, not only individual machines, but also the entire factories become smart and automated, making the production process more precise and the products more customized.
Mobile technology has been affecting the lives of 5.5 billion (two-thirds of the global population) internet users in the world. In 2023, globally, there were more than 8.9 billion mobile phone subscriptions, which have been changing the way people work, innovate, interact, and do business. The digital revolution deserves attention in its own right, but also because of the changes it has been creating in the world of work, and because of the way it has been accelerating globalization.
The global internet traffic has increased from 2401 exabytes in 2019 to 5291 exabytes in 2022 -- registering an average annual growth rate of 22%. In recent years, the digital revolution has accelerated the global production of goods and services, particularly the digital trade. In 2014 the global trade in goods was $19 trillion and trade in services $5tn. In 2023, the corresponding figures reached $31tn and $7tn respectively.
The knowledge-intensive portion of global flows increasingly dominates -- and is growing faster than -- capital- and labour-intensive flows. Today knowledge-intensive flows account for half of global flows and are gaining share: Knowledge-intensive goods flows are growing at 1.3 times the rate of labour-intensive goods flows. As a result, the digital components of goods and services flows have also increased. Indeed, many goods today, as demonstrated by the “app economy,” are entirely virtual. Much of the data passes through the internet, often on smartphones.
Inequalities in digital access have become a determining factor in explaining disparities in a society
The digital revolution may be associated with high-tech industries, but it is also influencing a whole range of more informal activities from agriculture to street vending. Some may be directly related to mobile devices. In Ethiopia farmers use mobile phones to check coffee prices. In Saudi Arabia farmers use wireless technologies to carefully distribute scarce irrigated water for wheat cultivation.
In some villages in Bangladesh, female entrepreneurs use their phones to provide paid services for neighbours. Many people sell phone cards or sell and repair mobile phones across developing countries. But there are also benefits for many other types of activities, formal and informal, paid and unpaid.. Mobile phone–based economic activity is likely to keep expanding rapidly.
Yet in 2024, nearly 2.6 billion people in the world remain offline, and the vast majority without access are concentrated in developing countries. The usage gap remains a challenge too. Close to half (43%) of the world's population were not using mobile internet last year, despite living in areas with mobile broadband coverage. One billion people in the world cannot prove their identity which limits their access to digital services and opportunities. Financial inclusions have remained an illusion for different groups of people.
Sometimes digital inclusions remain a problem because of associated services. For example, the absence of sufficient electric connections and the high frequency of power failures in Sub-Saharan Africa make it difficult to take advantage of the digital revolution. Similarly, people in hilly regions or remote areas of a country do not have access to ICT.
Owning a computer or a smartphone sometimes remains beyond the capacity of many people in the developing world. In addition, sometimes the computer or smartphone companies change their models and services so quickly that the existing models and services owned by people become obsolete and useless.
Fostering digital inclusion is of paramount importance. Inequalities in digital access have become a determining factor in explaining disparities in a society. Equity in digital inclusions is a major driving force for removing such disparities in society and for restoring the overall socio-economic equalities.
Dr Selim Jahan is Former Director, Human Development Report Office and Poverty Division, United Nations Development Programme, New York, USA.