Inside the Black Box: Understanding the Role of Institutions in Bridging the Digital Divide

• Main Author: Wigdor, Ernest Mitchell
• Other Authors: Trebilcock, Michael
• Language: en_ca
• Published: 2010
• Subjects: Institutions; Economic Development; Information and Communications Technology; Digital Divide; 0398
• Online Access: http://hdl.handle.net/1807/26260

This dissertation is about the role of institutions in bridging the Digital Divide. Its thesis is that governments must encourage the consistently increased use of information and communications technology (“ICT”) if they hope to foster sustained economic growth. Superficially, the Digital Divide describes differences in ICT usage between rich and poor nations, but it is more profoundly concerned with poor nations’ integration into a global economy. Intensive academic study demonstrates that four factors are critical to the relationship between ICT usage and economic growth: institutions; telecommunications infrastructure; investment in ICT; and human capital. The dissertation addresses three perceived shortcomings in the literature. First, proponents of institutions’ importance use the term vaguely, often obscuring important distinctions between policies, laws and institutions, thereby inhibiting detailed analysis. Second, many writers see the institutional reform needed for growth as an exceedingly slow process due to factors beyond governments’ control. Third, the literature does not adequately address which institutions are salient to the relationship between ICT usage and economic growth or how to create them. The dissertation attributes more precise meanings to key terms and contests the view that institutional reform can only proceed at a glacial pace. Its primary goal, however, is to identify specific institutions that help mediate the relationship and to suggest how they might be built relatively quickly. Good institutions can create the enabling environment that allows for the building of telecommunications infrastructure, investment in ICT goods and services and the development of human capital to lead to economic growth. The analysis of institutions identifies several salient institutions and concludes that the manner in which they are designed often determines their effectiveness. Case studies of Singapore and Malaysia examine their successful, but divergent, development paths. Their different rates of development can be attributed, in part, to the quality of their institutions.