Structural Source of the Trap of ICT Advancement - Lessons from World ICT Top Leaders



Chihiro Watanabe, Kashif Naveed and Weilin Zhao


In light of the significant consequence of the trap of dramatic advancement of information and communication technology (ICT) in the global economy, both nations and firms that have been compelling their productivity decline. This resulted in great stagnation of ICT advanced economies and therefore its structural sources were analyzed. Based on an empirical analysis tracing, the trend in marginal productivity of ICT and its subsequent prices among the top ICT leaders in the world over the last two decades correlating with the effects of ICT, two faces of ICT advancement were identified. On one side, advancement of ICT contributes to its prices increase by new functionality development, its dramatic advancement particularly centered by internet results in the decline of its prices through freebies, easy copying, and standardization. It was demonstrated that the success of ICT leaders could largely be attributed to the way in which the two faces of ICT advancement were managed by maximizing the positive face of ICT advancement. This is done by means of the effective utilization of external resources in innovation while minimizing the negative face by outsourcing price decreasing factors. All of the aforementioned points can be invaluable lessons for global sustainability in both ICT advanced and growing economies in the midst of the advancement of ICT. The significance of innovation-consumption co-emergence for harnessing the vigor of counterparts is discussed.


Trap of ICT advancement, Two Faces of ICT, ICT Leaders, Anger of Consumer.


  • Brynjolfsson, E. and Hitt, L. (1996) ‘Paradox Lost? Firm-level Evidence on the Returns to Information Systems Spending’,Management Science, 42:4, pp. 541-558.
  • Kraemer, K.L. and Dedrick, J. (1994) ‘Payoffs from Investment in Information Technology: Lessons from the Asia-Pacific Region’, World Development, 22: 12, pp. 1921-1931.
  • Lichtenberg, F.R. (1995) ‘The Output Contributions of Computer Equipment and Personnel: A Firm Level Analysis.’ Economic Innovations and New Technology, 3:3-4, pp. 201-218.
  • Triplett, J.E. (1999) ‘The Solow Productivity Paradox: What do Computers do Productivity?’, Canadian Journal of Economics, 32:2, pp. 309-334.
  • Watanabe, C., Zhu, B. and Miyazawa, T. (2001) ‘Hierarchical Impacts of the Length of Technology Waves: An Analysis of Technolabor Homeostasis’, Technological Forecasting and Social Change, 68:1, pp. 81-104.
  • Watanabe, C., Asgari, B. and Nagamatsu, A. (2003) ‘Virtuous Cycle between R&D Functionality Development and Assimilation Capacity for Competitive Strategy in Japan’s High-technology Industry’ Technovation, 23:11, pp. 879-900.
  • Watanabe, C. (2013) ‘Innovation-consumption Co-emergence Leads a Resilience Business’, Innovation and Supply Chain Management, 7:3, pp. 92-104.

RNI Registration No. CHAENG/2016/68678