VoxDev Development Economics S6 Ep1: How does internet connectivity impact developing economies?
Jan 8, 2025
Lin Tian, an expert affiliated with INSEAD, discusses the economic impact of internet connectivity on developing countries. She explores the surge of internet access, particularly in rural areas, and the disparities it creates. The conversation highlights how internet connectivity enhances productivity, education, and employment opportunities. Tian also shares insights on how platforms like Alibaba empower small businesses by connecting them to global markets. Additionally, she discusses the transformative impact of AI on these economies and the importance of strategic government policies.
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Job Creation vs. Displacement
- In low- and middle-income countries, the internet often complements rather than replaces jobs, creating new opportunities.
- However, some automation is occurring, particularly in routine tasks, suggesting potential future job displacement.
Internet's Impact on Export Markets
- Internet access can help firms in low- and middle-income countries find international buyers and expand export markets.
- However, the impact is uneven, with larger firms benefiting more than smaller ones.
Transformative Power of Online Platforms
- Online platforms like Alibaba transform business, especially for small firms in developing economies.
- They reduce transaction costs, improve access to credit, increase visibility, and build reputation, but marketing is crucial for visibility.