Information, Technology, and Innovation: Resources for Growth in a Connected World

CHAPTER 10

Government

Governments have significant interactions with the technology and communications domains. They tax: Wireline telephony used to be a big revenue generator. They regulate: Wireless spectrum is auctioned and regulated by several agencies. They sue: Overly aggressive platforms risk being targeted with antitrust litigation. Finally, they buy: Government is a large but idiosyncratic user of many information technologies. The transition from a manufacturing to services economy in the United States coincides with the rise of computing, with some far-reaching implications.

Isolating how IT has shaped the economy and society turns out to be much less direct than looking for the impact of, say, the automobile. At the macro level, for about a century manufacturing surged at agriculture's expense as the primary locus of employment. From 1950 until 1980, however, while manufacturing employment grew in raw numbers, this growth occurred against the backdrop of the population expansion that followed World War II: as a percentage of total employment, and of economic output, manufacturing was shrinking even as it appeared to grow.

Given that the 1950–to–2000 half century was marked by a precipitous loss of employment as a percentage of the workforce in both agricultural and manufacturing arenas, we know that services have become the dominant economic sector. According to the Central Intelligence Agency's World Factbook, “industry” constitutes 20% of the U.S. economy while services ...