Promoting the diffusion of technology to boost productivity and well-being in Korea
Korea is a top player in emerging digital technologies, with an outstanding digital
infrastructure and a dynamic ICT sector. The COVID-19 outbreak highlighted the importance
of digitalisation to contain the spread of the virus, by allowing quick testing and
tracing of infected people, and spurred the development of the "untact economy". Remote
access both facilitated physical distancing and mitigated the economic impact of the
crisis by enabling more people to continue working. Digital technologies offer opportunities
to raise firms’ productivity and the population’s well-being. However, wide productivity
gaps between large firms and SMEs and between manufacturing and services weigh on
economy-wide productivity, which is far below the OECD average. A wide skills gap
between youth and older generations prevents an increasing share of the population
from taking part in and enjoying the benefits from a digitalised economy. This paper
suggests ways to narrow the digital divide by enhancing the diffusion of digital technologies
among firms and among individuals. Increased participation in quality ICT education
and training for students, teachers, SME workers and older people is key to address
the lack of adequate skills and awareness of digital benefits or dangers (online security,
cyberbullying, addiction). Promoting innovation networks between SMEs, academia and
large firms through vouchers or platforms can support SMEs’ R&D and commercialisation
of innovative goods and services. Waiving stringent regulations through regulatory
sandboxes can help identify and alter regulations that hinder the adoption and diffusion
of digital technologies.
Published on January 21, 2021
In series:OECD Economics Department Working Papersview more titles