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Impact of information and communications technologies on government innovation policy: a systematic framework and an international comparision

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With the rapid development of information and communications technologies (ICT), the greatest challenge to policy-makers today is whether it will have a fundamental and structural impact on the way economies function and its sustainability on the standard of living. Statistics showed that the “Solow’s productivity paradox”, which saw how productivity growth in major industrialized countries declined in the 1970s and 1980s despite phenomenal growth in technological improvements, has been overthrown by bursting rates of productivity growth since the mid-1990s. Besides establishing evidence of a trend growth,studies also conclude that potential productivity gains from the use of ICT will come from a combination of organizational changes that ICT brings about, a skilled workforce in ICT, and technology RandD activities. Therefore, although productivity gains will extend into the future, the rate at which these gains can be fully realized depends on the speed at which businesses and citizens can embrace ICT. There is clearly a role for the government in the digital economy, not of an economic regulator as under the traditional SandT policy of “picking the winners”, but more of a facilitator, enabler, and orchestrator of innovative activities. Public policy in the information society needs to focus on preventing the digital divide, and more importantly on stimulating the demand for ICT and encouraging technological innovative activities on a broad scale. This paper looks at three aspects of the innovation policy, namely (a) Innovation in the public sector: e-Government; (b) Innovation policy in the private sector: Fostering technological innovation; and (c) Innovation policy in the people sector: Building an all-inclusive information society. Recognizing that the government has the largest client base and that the public sector can serve as a leveraging platform to demonstrate how ICT can meet needs more efficiently, the development of an e-government can provide a catalytic force by stimulating a demand for ICT and creating a “market” for ICT applications. From the “best practices” of leading e-governments such as Canada, Singapore, the United States, Norway, Australia, and Ireland, four important aspects of an e-government strategy are identified, namely (a) the development of a broad e-government vision and the implementation of delivery mechanisms; (b) the progression from mainly one-way and passive informational services to interactive, citizen-centric, and integrated online services; (c) building transactional capabilities through Public Key Infrastructure, focusing on the authentication, non-repudiation, confidentiality, and integrity of information flows; and (d) equipping civil servants to become knowledge workers in the knowledge economy. In the private sector, critical “pulse points” that will encourage technologically innovation on a broad scale are identified, namely developing financial and technological infrastructure, institutionalizing a regulatory framework, developing a skilled workforce in ICT, creating an innovative, creative, and entrepreneurial culture, and forming strategic international alliances, illustrating with “best practices” from Singapore, United States, Israel, Finland, Sweden, and Japan. Finally, recognizing that the digital divide can be an unfortunate consequence of the ICT revolution, the paper examines what leading countries such as the United States, Singapore, Sweden, and Finland have done to create an all-inclusive information society, by transforming non-ICT users first to passive users through increasing their ability to access information, and finally to active users, where ICT becomes a means of communication and a way of life. Specific regulatory issues thrown up by the information society, such as the delicate balance between privacy protection and the risks of abuse by specific interest groups, will also be examined.

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