The impact of digital revolution on social fairness: four seminar’s topics

1. INTRODUCTION

The emergence of the Internet and smartphones, the connection between the two phenomena and the progress of digitization have transformed both our personal lives and the way in which economic activities take place. Now we do many things differently at work, and in our leisure time in comparison to how we used to do them. The Internet has become a part of our everyday life, rather than a separate place to be^[1] and some tech companies have become a big part of our lives. Looking ahead, phenomena as Big Data, Internet of Things (IoT), artificial intelligence (AI), machine learning (ML) and the advancement of robotization and mobile robotics (MR) will accelerate this transformation. Digitalization does not change economic laws^[2], nor does government objectives (economic efficiency, equity, business cycle stabilization and long-term economic development). However, economic relations change and economists who study government intervention in the economy must consider this transformation in their analysis to better understand how society functions. Unequivocally we find ourselves in the middle of an information revolution and incorporating the impact of the digital revolution on public economics syllabus will result in a greater interest on the part of our students. Students who nowadays are digital natives.^[3] This article outlines certain topics that could be incorporated in public economics courses in relation to equality and redistributive aspects. In connection to this specific field, I propose a set of discussion topics that can be used in seminars as well as for individual essays’ subjects. In addition, some practical aspects on how to conduct the seminar are included at the end of the paper. In particular, some details on how to organize the seminar, a sample of seminar’s instructions and tips on how to perform the presentations, as well as a suggestion on how to evaluate the seminar session are shown.

Although this article focuses on equality and redistributive aspects, it should be emphasized that much of the content of public economics syllabus should be revisited under the light of the impact of the digital revolution.^[4] A new generation of students that has already entered the university is termed digital natives. This is the main reason why we propose to cover the material on equity using the format of a seminar instead of traditional lectures. This net generation is said to have been immersed in technology all their lives. People of this generation are ready to speak about their experiences on the access to ICTs and their skills on tech matters. They feel technology at the core of their lives and a seminar on this subject may contribute to get public economics closer to their learning interests.

2. COMMON TOPICS ON EQUITY AND REDISTRIBUTION IN PUBLIC ECONOMICS COURSES

On the one hand, government interventions in the economy are justified by the existence of economic inefficiencies. The analysis of inefficiencies arising from market failures occupies a relevant part in public economy manuals. But even in the event that an economically efficient outcome could be achieved after all market transactions have taken place, it may happen that the resulting outcome may be undesirable for the society due to its unfairness. This usually occurs when the initial endowments of the society's members are very unequal. Also for that reason, governments intervene in a number markets, in this case aiming to increase horizontal and vertical equity levels. As a result, all public economics courses include the analysis of topics connected to equity level and redistributive goals, including among others those shown in Table 1.

Table 1: Common topics on equity in public economics coursesSource: Own elaboration.

3. SOME TOPICS ON THE IMPACT OF DIGITAL REVOLUTION ON EQUITY AND REDISTRIBUTION 

In this section, I propose four topics that relate to the consequences of digitalization and robotization of the economy on fairness and distributive aspects. For each topic, I point out some of the arguments to consider in the discussion and offer a set of reading lists to deliver to students.

It should be noted that the digital revolution is also significantly affecting two other services typically provided directly or indirectly by governments with an impact on equity: education and healthcare. These two topics are not covered in this article.

3.1. DOES INTERNET REDUCE INEQUALITY?

In the discussion on the equalizing power of Internet,[5] we find many arguments regarding the possible improvement of equal opportunities between nations and individuals that the diffusion of the Internet could generate. See Table 2.

Table 2: The case for the equalizing power of the InternetSource: own elaboration.

However, not all scholars are so optimistic about the impact of digital technologies on the inequality level among nations and among citizens of each country. For some, the rise of informationalism at the end of the millennium has been linked to situations of increasing inequality and higher exclusion.[6] Some pessimistic opinions about the contribution of the Internet to the level of social justice between individuals are shown in Table 3.

Table 3: The case for a negative contribution of the Internet to the level of equitySource: own elaboration.

3.2. HOW RELEVANT IS AND WHAT DETERMINES THE DIGITAL DIVIDE?

The access to the Internet has been developing unevenly in the world, between nations[7] and individuals. The digital revolution has transformed the lives of many, but also has left untouched the lives of many others.[8] Part of the world population misses out on the opportunities created by the Internet. This gap between the information haves and have-nots is commonly referred to as the digital gap or the digital divide.[9] Internet threatens to divide society into two classes: the information elite on the one hand and those not linked to the Net on the other. When it comes to participating in the information age this gap relates to both economies and individuals within each society.[10] This digital gap is identified with differences regarding: the availability of physical access to the Internet, the possibility of using the Net from different devices; the spatial access flexibility; or navigation skills[11]. Both, practitioners and researchers distinguish three stages in the diffusion and social impact of new technologies: the access, the effective usage and its tangible impact.[12] Regarding the main determinants of the digital gap see Table 4, and see Table 5 for empirical results.

Table 4: Main determinants of the digital gap

(continuation of Table 4)                                                               Source: Prepared by the author based on Contreras (2017).

Table 5: Empirical evidence on the digital gapSource: Prepared by the author.

3.3. DOES SHARING ECONOMY ALTER UNFAIRNESS LEVEL?

One feature of phenomena such as Web 2.0/3.0 and social media is the relevance of sharing.[13] Sharing of goods and services has always existed, but traditionally it has taken place within the family or among agents who knew each other, and among whom there was a relationship of trust. The emergence of what has come to be called sharing economy o collaborative economy,[14] represents an important change, since it has allowed the collaboration and sharing among strangers. Something that has been feasible thanks to innovations in information technologies.[15] Individuals and companies increasingly consider sharing as a profitable alternative to ownership[16]. Growth in sharing systems accelerated by social media’s ability to facilitate online music and movie sharing, but recently physical product sharing systems are expanding at a rapid rate as well[17]. How does this new collaborative economy affect fairness level? Table 6 shows some arguments supporting a positive effect.

Table 6: An optimistic view of the collaborative economy on fairness levelSource: Own elaboration.

However, many commentators are of the view that the development of the collaborative economy will result in a more unfair society. In Table 7, some arguments supporting this negative effect are shown.Source: Own elaboration.

  Table 7: An optimistic view of the collaborative economy on fairness levelSource: Own elaboration.

3.4. HOW DO ROBOTS AFFECT INEQUALITY

Computers are beginning to automate and make redundant plenty of jobs previously expected to remain in human control for a long time. The combination of artificial intelligence, big data, machine learning and mobile robotics imply that robots will be able to do almost every job. We face a world of driverless cars, drones for package delivery, computer programs to diagnose illnesses, and intelligent pattern recognition software that replaces lawyers, professors, doctors, journalists and others professionals. Robotics is already playing an important role in employment in the industrial and service sectors. Robots replacing humans has become one of the most discussed topics in research and business circles.[18]

It has been stated by some commentators that automated technology will be much more destructive of jobs than previous technological innovations. Cybernation or automation would result in an economy where potentially unlimited output can be achieved by systems of machines, which will require little cooperation from human beings.[19] Virtually every industry in existence is likely to become less labour-intensive. Machines are not only tools that increase the productivity of workers. Machines themselves are turning into workers. Technology will lead to a permanent, structural unemployment.[20] For some, the advance of robotics will result into not only higher unemployment, but also an additional step of redistributing income from work to capital. See Table 8.

Table 8: A pessimist view of the impact of robotization on fairness levelSource: Own elaboration.

Robotics and artificial intelligence system will bring a wave of abundance. Even if automatization results in a higher level of unfairness, there will be a decrease of material poverty. Abundance of digital goods and services (including healthcare and education services), lowering of costs and increasing personalization will result in a raise of living standards for all individuals. Table 9 shows some arguments supporting an optimistic view of the impact of robots at work.Source: Own elaboration.

Table 9: Robotization will not result in a less fair society

Source: Own elaboration.

4. PUBLIC POLICY ISSUES

In this section, I propose some public policy issues to be addressed in connection to the role of the government in a scenario of digital revolution. See Table 10.

Table 10: Questions

5. WHY TO USE THE SEMINAR METHOD?

 There are at least two questions to answer in connection to the proposition of the four seminars that are discussed in this article. First, why to use the seminar method to address the topic of social fairness. Secondly, why to focus on the impact of the digital revolution when studying social inequality.

Regarding the first question, a seminar is a modern method of teaching and an advanced group technique of increasing use in higher education for a number of reasons. When it comes to discussing social fairness, all participants have an opinion to express, and the seminar method may give good motivation and learning experience to participants. The selection of these four topics enables between four and five groups of students and different discussants to participate in a session of 2 hours. See in table A1 in the appendix some instructions proposed for the seminar. Moreover, this method integrates reading and writing skills with presentation skills, which are of quite considerable benefit when compared with traditional lectures. In addition, the human interaction under this technique develops good manners and skills among the participants, and provides a good scholastic experience. The interactions in this method develop observation and questioning skills. Finally, this method inculcates responsibility and cooperative behaviours. See in Table A2 some recommendations and tips proposed to seminar’s participants.

The second question relates to the choice of the topic on how digital revolution may affect social inequality levels in a modern society. In public economics courses when it comes to discussing how egalitarian are contemporary societies, issues being tackled traditionally include, among others, inequality of income and social immobility, and how public policies may help to redress these situations. In the last century, taxes and inequality educational opportunity (IEO) have probably been the main drivers of both phenomena. In a digital economy, IEO remains crucial but new issues emerge. In particular, in the knowledge economy, issues as the inequality of access to new technologies, the power of workers in the virtual company, the role of free lancers in the collaborative economy, or the impact of robots and artificial intelligence on labour market become paramount. This is the main argument in support of the proposal included in this paper.

Appendix

Table A1: General seminar instructions 

Table A2: Recommendations and tips

Notes

^[1] See Howard et al. (2001).

^[2] See Shapiro and Varian (2013).

^[3] See Tapscott (1998) and Jones and Fox (2009).

[4] See Contreras (2017) for a non-advanced review of effects of the digital revolution on public economics analysis.

[5] See Webster, C. (1995) and Christensen. (1995).

[6] Véase Castells (1998).

[7] See Kiiski and Pohjola (2002) and Vicente and López (2011).

[8] See Yu (2002).

[9] See Mosaic Group (1998), Castells (2001), NTIA (1999), Rogers (2001), Norris (2001) or Kirkman et al. (2002).

[10] See Chen and Wellman (2004).

[11] See Kling (1998), Lessig (1999) O’Mahoney and Barley (1999), Wilson (2000), Bimber (2000), DiMaggio and Hargittai (2001), Fink and Kenny (2003), Hargittai (2003), DiMaggioet al. (2004), Barzilai-Nahon (2006) or Pearce and Rice (2013).

[12] See OECD (2001), Katz and Rice (2002) and Hilbert (2014)..

[13] See O'Reilly (2005).

[14] This phenomenon is also connected with concepts such as collaborative consumption, co-production, co-creation, or presumption.

[15] Véase Zelizer (2010).

[16] See Belk (2007) and Botsman and Rogers (2010).

[17] See Lamberton and Rose (2012).

[18] See Lukina et al. (2016).

[19] See Ford (2015).

[20] See Ford (2009 and 2015), Brynjolfsson and McAfee (2001)

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