Hostname: page-component-cd9895bd7-p9bg8 Total loading time: 0 Render date: 2024-12-31T16:05:08.440Z Has data issue: false hasContentIssue false
  • English
  • Français

Data, development, and growth

Published online by Cambridge University Press:  17 April 2017

Steven Weber
Get access Rights & Permissions [Opens in a new window]

Abstract

Economic development and growth theory have long grappled with the consequences of cross-border flows of goods, services, ideas, and people. But the most significant growth in cross-border flows now comes in the form of data. Like other flows, data flows can demonstrate imbalances among exports and imports. Some of these flows represent ‘raw’ data while others represent high-value-added data products. Does any of this make a difference in national economic development trajectories? This paper argues that the answer is yes. After reviewing the core logic of ‘high development theories’ from the twentieth century, I analyze the sometimes implicit applications of these arguments to data as they are evolving in the existing literature. I then put forward a different argument which takes better account of unique characteristics of the political economy that emerges at the intersection of data, machine learning, and the platform firms that use them. I explore the implications of this new argument for some policy choices that governments face with regard to data localization, import substitution, and other decisions relevant to growth in both advanced and emerging economies.

Type
Research Article
Information
Business and Politics , Volume 19 , Issue 3 , September 2017 , pp. 397 - 423
Copyright
Copyright © V.K. Aggarwal 2017 and published under exclusive license to Cambridge University Press 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

Footnotes

Funding for this work was provided by the Hewlett Foundation via the Center for Long Term Cybersecurity at UC Berkeley; and by the Carnegie Corporation via the ‘Bridging the Gap’ grant program.

Acknowledgments: Thank you to Jesse Goldhammer, Stephane Grumbach, Phil Nolan, AnnaLee Saxenian, Naazneen Barma, Elliot Posner, two anonymous reviewers, and the Editors of Business and Politics for comments and critiques.

References

Baldwin, Richard. 2011. “Trade and Industrialization after Globalization's Second Unbundling: How Building and Joining a Supply Chain Are Different and Why It Matters.” NBER Working Paper 17716. Available at http://www.nber.org/papers/w17716.Google Scholar
Baldwin, Richard. 2016. The Great Convergence: Information Technology and the New Globalization. Cambridge, MA: Belknap Press of Harvard University Press.Google Scholar
Cardoso, Fernando H. and Faletto, Enzo. 1979. Dependency and Development in Latin America. Berkley, CA: University of California Press.Google Scholar
Chen, Min, Mao, Shiwen, and Liu, Yunhao 2014. “Big Data: A Survey.” Mobile Networks and Applications 19 (2): 171–209.Google Scholar
Chen, Yong, et al. 2016. “Big Data Analytics and Big Data Science: A Survey.” Journal of Management Analytics 3 (1): 1–42.CrossRefGoogle Scholar
Cory, Nigel. 2016. “The Worst Innovation Mercantilist Policies of 2015.” ITIF, 11 January 2016. Available at https://itif.org/publications/2016/01/11/worst-innovation-mercantilist-policies-2015.Google Scholar
Faravelon, Aurelien, Stephane Frenot, and Stephane, Grumbach 2016. “Chasing Data in the Intermediation Era: Economy and Security at Stake.” IEEE Security and Privacy Magazine, Economics of Cybersecurity, Part 2.CrossRefGoogle Scholar
Fosso Wambe, Samuel, et al. 2015. “How Big Data Can Make Big Impact: Findings from a Systematic Review and a Longitudinal Case Study.” International Journal of Production Economics 165: 234–246.Google Scholar
Ghosh, Atish R., Ostry, Jonathan D., and Qureshi, Mahvash S.. 2016. “When Do Capital Inflow Surges End in Tears?” American Economic Review 106 (5).Google Scholar
Hamilton, Alexander. 1791. Report on the Subject of Manufactures presented to the House of Representatives. 5 December 1791 by the Secretary of the Treasury.Google Scholar
Kennedy, Joe. 2015. “Why Internet Platforms Don't Need Special Regulation.” The Information Technology and Innovation Foundation (ITIF). 19 October 2015. Available at https://itif.org/publications/2015/10/19/why-internet-platforms-don't-need-special-regulation.Google Scholar
Krugman, Paul. 1991, “The Move Toward Free Trade Zones.” In Policy Implications of Trade and Currency Zones, symposium sponsored by The Federal Reserve Bank of Kansas City, Jackson Hole, Wyoming. 22–24 August.Google Scholar
Krugman, Paul, ed. 1986. Strategic Trade Policy and the New International Economics. Cambridge, MA: Massachusetts Institute of Technology Press.Google Scholar
Krugman, Paul. 1990. Rethinking International Trade. Cambridge, MA: Massachusetts Institute of Technology Press.CrossRefGoogle Scholar
Krugman, Paul. 1992 “Toward a Counter Counter-Revolution in Development Theory.” World Bank Economic Review 6 (suppl 1): 15–38.Google Scholar
Lindauer, David L. and Prichett, Lant 2002. “What's the Big Idea? Third Generation Policies for Economic Growth.” Economia 3: 1–39.Google Scholar
Manyika, James, Lund, Susan, Bughin, Jacques, Woetzel, Jonathan, Stamenov, Kalin, and Dhingra, Dhruv. 2016 “Digital Globalization: The New Era of Global Flows.” McKinsey Global Institute, exhibit E1 page 3.Google Scholar
MGI. 2016a. Globalization: The New Era of Global Flows. San Francisco.Google Scholar
MGI. 2016b. Globalization: The New Era of Global Flows. Exhibit E2, San Francisco.Google Scholar
Rochet, Jean-Charles and Tirole, Jean. 2006. “Two Sided Markets: A Progress Report.” Rand Journal of Economics 37 (3): 645–667.Google Scholar
Rodrik, Dani. 2005. “Growth Strategies.” In Handbook of Economic Growth Volume 1, edited by Again, Philipe and Durlauf, Steven, chapter 14.Google Scholar
Rodrik, Dani. 2015. “Premature Deindustrialziation.” IAS School off Social Sciences Economic Working Papers Number 107, January.Google Scholar
Romer, Paul M. 1993. “Two Strategies for Economic Development: Using Ideas and Producing Ideas.” Proceedings of the World Bank Annual Conference on Development Economics, published in supplement to the World Bank Economic Review, March 1993, 63–91.Google Scholar
Weber, Steven. 2005. The Success of Open Source. Cambridge, MA: Harvard University Press.CrossRefGoogle Scholar
Williamson, Oliver E. 1981. “The Economics of Organization: The Transaction Cost Approach,” The American Journal of Sociology 87 (3): 548–577.CrossRefGoogle Scholar
Zysman, John, Doherty, Eileen, and Schwartz, Andrew. 1996. “Tales From the ‘Global’ Economy: Cross National Production Networks and the Re-organization of the European Economy.” BRIE Working Paper 83 June.Google Scholar