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The Internet Is Increasing Inequality, Says The World Bank

Its benefits depend on where you live and your current economic status.

[Photo: Flickr user eric wittman]

The Internet has often been called the Great Democratizer; a tool that gives everyone the opportunity to have their voice heard and to gain access to the same universal wealth of information as everyone else–-in short, a tool that puts everyone on equal footing. But according to a new report from the World Bank, that feel-good belief may be far from the truth. In fact, the Internet may be widening inequality.

In the report, issued Wednesday, the World Bank says the technological changes brought on by the Internet have not improved access to public services or increased economic opportunities as had been expected. "Digital technologies are spreading rapidly, but digital dividends—growth, jobs, and services—have lagged behind," the bank said.

The report's authors pointed out that those already well-off and well-educated have taken advantage of the Internet to achieve great success, however those on the lower end of the economic and education spectrums have seen fewer benefits, if any. The bank notes that 20% of the world’s population is still illiterate, making the Internet almost entirely useless to them. In other countries, women are discouraged from going online. In specific regions of the world, mobile phone ownership is disproportionately low, meaning that fewer citizens have access to the Internet. In total, 60% of the world’s population still remain offline.

And even in places where populations do have easy access to the Internet and booming technology sectors, the economic benefits remain skewered mostly toward people who were already well-off. In developed countries, the technology sector still only employs 3% to 5% of the workforce. In developing countries, it’s less than 1%. In short, though the Internet and technology sectors have made some people very, very rich—virtually overnight—it’s not creating as many jobs as need be.

The countries that are best able to take advantage of the economic benefits of the Internet are those with the largest number of users: China, the United States, and India, the report said.

"Countries that are investing in both digital technology and its analog complements will reap significant dividends, while others are likely to fall behind" the bank said in the report. "Technology without a strong foundation risks creating divergent economic fortunes, higher inequality, and an intrusive state."

However, the report say that simply expanding access to the Internet won’t stem the tide of inequality it is creating.

It says that governments must ensure competition between companies remains strong, programs are launched so workers can gain new skills needed by the tech sector, and that government institutions themselves remain accountable. These three things, the report said "are the foundation of economic development."

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