Wednesday, November 5, 2014

Article Report: Information Technology and the Integration of the Global Economy

The article that I have been assigned to do my blog critique on is a chapter from a book, written by Michael Spence, entitled The Next Convergence: The Future of Economic Growth in a Multispeed World. Michael Spence is a notable American Economist.  He holds a Ph.D. in microeconomics from Harvard University and is currently an economics professor at the New York University Stern School of Business.  The particular chapter from his book that this assignment focuses on is Information Technology and the Integration of the Global Economy.  Broadly, this chapter discusses the ways in which advancing technology has affected and continues to affect the global economy, and it’s implications for the future.  Early on, he discusses at length the economic revolution spurred on by the massive transition to computer-based systems and the subsequent digitization of information.  This revolution saw enormous increases in productivity and the convenience of everyday life.  This revolution also had a large impact on the structure of the job market, as technology took over the burden of many jobs previously held by actual human beings.  Though he admits that we as a society did not adequately use the advancing technology to reach the full potential it offered us, Spence attributes our shortcomings to this revolution itself.  He argues that the changes were so significant and the scale was so large that we could not have hoped to fully understand the new economy.  Another topic discussed at length by the author was globalization.  Specifically, he refers to the globalization of the economy that has been enabled by advancing information and networking technologies.  He explains how these technologies have empowered less developed nations to essentially ‘close the gap’ on the more developed nations in the world.  The wider accessibility to information as well as networks with which to share that information has resulted in more educated populations and an increase in economic potential and power.  The author attributes both the rapid growth of less developed nations and the increasingly common practice of offshoring to these countries to this globalization caused by advancing technology.  He also argues that although this globalization comes at a cost to more historically developed countries and is generally viewed negatively by the citizens of those countries, this process, overall, could be extremely beneficial.  This opinion is illustrated well by a quote from the chapter, “We can look forward to a period in which the opportunities and incomes of poor people in many parts of the world expand substantially.”  My reaction to this chapter is positive.  I think the general message of this chapter is that technology has the potential to be extremely beneficial to society, yet it is such a young, different, and generally uncharted territory in terms of being able to make accurate models and predictions. Thus, many aspects of technology are viewed negatively by society, often times prematurely and unjustly.  Based off of what we have learned so far in this class, that is an opinion that I have echoed.  For instance, in my first paper, I addressed a similar situation with the mobile phone.  The cell phone has many detractors due to the way it has altered social infrastructure. However, these alterations aren’t necessarily bad, they’re just different from what we historically have known and accepted to be the correct social infrastructure. In addition, and more importantly, the benefits provided to us by the cell phone and other technologies far outweigh any negative aspects of them.  

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