Special to OECD Ministerial Meeting on the Digital Economy: Innovation, Growth and Social Prosperity, Cancun, Mexico, 21-23 June 2016

The Internet is now an essential part of our lives and a critical element of the world economy. Internet penetration increased almost sevenfold in the past 15 years, from 6.5% of the world population in 2000 to 43% in 2015.

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On 21-23 June Mexico hosts the OECD Ministerial Meeting on the Digital Economy. The first ministerial of its kind on this subject (then called “electronic commerce”) was held in Canada in 1998, and the second one in Korea in 2008; hence Mexico is the third country to have this distinction and the first Latin American country to organise and lead this undertaking. As the use of information and communications technology (ICT) is favourable for productivity across a large number of strategic industries in any economy, we have chosen "Innovation, Growth and Social Prosperity” as this year’s theme, three goals that can hardly be achieved without the impetus of digital technology.

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The digital economy is here, and growing every day, sometimes in surprising ways. As ministers gather for major meetings in Paris and Cancun, government leaders should be in no doubt about the key role they must play in securing the digital economy’s future as a driver of productive and inclusive progress.

When the OECD adopted its first E-commerce Recommendation in 1999, online spending on so-called e-commerce was well-below 1% of total retail spending. Fifteen years later, the figures have jumped to almost 8% in the EU and more than 11% in the United States. This is no longer some future trend: e-commerce is here and is critical for the economy, in which household consumption accounts for about 60% of total GDP in the OECD area.

Pepper the humanoid robot, at OECD Forum 2016 ©Rory Clarke/OECD Observer

To many workers, the words “digital technologies” may evoke one simple, dismaying image: a human-like robot sitting at their desk, doing the work that they used to do! This anxiety is not different from the fear of coachmen witnessing the diffusion of cars in the 1920s. In a sense, coachmen were right: cars did replace horse coaches. However, their children and grand-children found new and often better paid jobs in the wealth of new activities made necessary or possible by cars: automobile manufacturing, car repair, travelling sales, home delivery, mass tourism, road building, the petrol business, and so on.

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Connectivity is the foundation for the digital economy. The Internet has already connected more than three billion users across the globe and about 14 billion devices. 

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The digital economy is a transformative process, brought about by advances in information and communications technology (ICT) which has made technology cheaper and more powerful, changing business processes and bolstering innovation across all sectors of the economy, including traditional industries. Today, sectors as diverse as retail, media, manufacturing and agriculture are being impacted in some way by the rapid spread of digitalisation. In the broadcasting and media industry, for instance, the expanding role of data through user-generated content and social networking have enabled internet advertising to surpass television as the largest advertising medium.

©David Rooney

Now more than ever, the digital economy is the economy. Digital technologies, or Information and Communication Technologies (ICTs), are boosting trade, innovation, entrepreneurship, and with them growth and social wellbeing. Those benefits depend on openness. Openness has technical, economic and social dimensions, from open standards for core technologies and protocols, and competitively priced access for users, to the respect for human rights, freedom of expression and privacy. In essence, openness enables people to access, and do more things with, digital technologies: start a business online, create new products and business processes or revolutionise existing ones, express opinions, raise capital, share knowledge and ideas, conduct research, interact with government, improve skills, and much more. 

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Three out of four people access the Internet everyday across the OECD. But one-third of those daily users don't yet buy online. Why not? According to a 2014 consumer survey the top two concerns reported by EU Internet shoppers are the misuse of personal data and security of online payments. 

What policy actions are you taking to harness the benefits and address the challenges of the digital economy?

A clash between robots and workers is unlikely. Rather, disruptive technology can make workers more efficient without replacing them, and raise profits, while maintaining or increasing a company’s workforce.

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The rapid rise of a new generation of connected, intelligent devices—collectively known as the Internet of Things, or IoT—is more than just the latest digital enabler to impact organisations of all sizes. The IoT presents vast opportunities for governments and businesses to improve internal efficiencies, serve their customers or constituents better, and enter new markets or provide new services. Such services will transform the way we work and live every day. As the IoT develops, it is essential that security-by-design be a core feature of the connected device ecosystem.

Few issues are of greater concern to Internet users today than privacy protection. Everyone wants the benefits of Internet access, but few want to sacrifice their privacy or face the risk of cyber theft as a consequence. 

©David Rooney

I’m sure you’ve all heard about “the open Internet.” The expression builds upon a rich pedigree of the term “open” in various contexts. It gives the impression that “open” is some positive attribute, and when we use the expression of the “open Internet” it seems that we're lauding it in some way. But are we, and if so, in what way?

©James Thew/Alamy Stock Photo

Meteorology was the first scientific discipline to use space capabilities in the 1960s, and today satellites provide observations of the state of the atmosphere and ocean surface for the preparation of weather analyses, forecasts, advisories and warnings, for climate monitoring and environmental activities. Three-quarters of the data used in numerical weather prediction models depend on satellite measurements. 

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Recent years have seen a rapid rise in digital transactions, notably through web-based “sharing economy” platforms that have bridged, and indeed blurred, the gap between consumers and producers. But this upsurge has also created new challenges for measuring GDP, and, against a backdrop of slowing rates of productivity growth, has led some to question whether the slowdown reflects these new transactions.

The world has seen more than one industrial revolution and another one is already upon us. We should face it as optimists.

The UK’s tallest mountain is Ben Nevis in Scotland. Recently, it became one metre taller, standing now at 1 345m rather than 1 344m above sea level. Of course, the mountain did not actually grow. Rather, the team of Ordnance Survey experts who re-measured it for the first time since 1949 were able to do so more accurately because of improvements in technology, and specifically through the use of GPS.

Over the last few years there has been increased interest among start-ups in using Internet-based platforms to crowd­source a wide variety of resources, including funding, labour, design and ideas. Does this approach work?

Code is the next universal language. In the 1970s punk rock drove a whole generation. In the 1980s it was probably money. For my generation, the interface to our imagination and to our world is software. This is why we need to get a more diverse set of people to see computers not as boring, mechanical and lonely things, but as something they can poke, tinker with and turn around.

Charlotte Moreau

Algorithms lie at the heart of machine learning, which, in turn lies at the heart of much of modern life–from online shopping to intelligence gathering. But most of us know little about these powerful tools and how they work. Is this wise?

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"We are the children of a technological age. We have found streamlined ways of doing much of our routine work. Printing is no longer the only way of reproducing books. Reading them, however, has not changed.” Lawrence Clark Powell

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We are so used to all things digital that we can sometimes lose sight of just how enormous the phenomenon has become, and how disruptive it can be. The bit volume of cross-border digital flows has grown by 45 times in the past decade. An estimated 211 terabits of data, which is the equivalent of 8,500 entire Wikipedias, flow across borders every second. Approximately 12% of global consumer goods trade is now conducted via international e-commerce. Some 50 million small companies are now on Facebook alone, double the number in 2013.

With internet and technology use constantly expanding, data abound. So many data are collected and stored every day that we are seeing new jobs and entire sectors emerging just to deal with them all. Data-Driven Innovation explores the potential uses for and issues of this era of “big data”, providing a resource from which to see the big picture, with the promises and risks for well-being and productivity. 

A Better Than Cash Alliance supporter: Bill Gates ©Bernd Von Jutrczenka / DPA Picture-Alliance/AFP

Access to financing can contribute to inclusive social and economic development. How might digital transactions help? Here’s how.

Women in developing countries are 21% less likely to own a mobile phone than men ©Reuters/Thomas Mukoya

Women are consumers, business owners, farmers, employees and entrepreneurs. They are dependent on market systems and need access to finance to manage their livelihoods.

Dementia is an umbrella term coined to embrace all the chronic brain disorders that progressively lead to brain damage and the deterioration of memory, functional capacity and social relations. Alzheimer’s disease, which is fatal, is the most common form of dementia, representing about 60-80% of cases, according to a 2009 study carried out by the non-governmental organisation Alzheimer Europe.

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Are digital tools simplifying our interactions with public authorities? From document browsing to downloading of forms as well as administrative procedures, governments in most of OECD countries now offer a wide range of online services. 

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