Three Perspectives on Development as Transformation: Implications for DX4D

How is transformation understood in international development, and what are the implications for digital-transformation-for-development (DX4D)?

An earlier blogpost pointed out that digital transformation is not the goal of DX4D, “Instead, development transformation is the goal and starting point”.  That blogpost considered what transformation means under different development paradigms, and what role digital would play in helping deliver those different meanings of development transformation.

In this blogpost, three active perspectives on transformation in international development are analysed – structural transformation, transformational development, and transformative development studies – and some DX4D implications drawn out.

1. Structural Transformation

“Structural transformation is defined as the reallocation of economic activity across three broad sectors (agriculture, manufacturing, and services) that accompanies the process of modern economic growth”[i].

That reallocation is associated with a steady decline of agriculture in terms of share of employment and share of GDP, a steady increase in services, and a more mixed picture (e.g. an inverse-U of relative growth then decline) for manufacturing.  This is transformation that is readily measured and that is associated with other developments: urbanisation, economic growth and rise in incomes, changes in income distribution, etc[ii].

For DX4D, structural transformation offers a very tangible and big picture vision of what transformation means, and it supports the idea of technology being not merely an enabler but one of the main driving forces behind (this form of) transformation[iii].  Indeed, it is sometimes argued that emergence of what has variously been known as the information economy, or knowledge economy, or digital economy represents a fourth main economic sector that emerges directly as a result of digital innovation[iv].  From this perspective, DX4D would be analysed through an economic lens and in terms of its contribution to sectoral change.

Adhering to a modernisation paradigm of development, structural transformation would be criticised for its techno-centricity and its preoccupation with economic growth.  However, it does argue that more than just technology is required for transformation: for example, change in processes such as growth in trade, and wider structural changes such as development of formal and informal institutions[v].

2. Transformational Development

“Transformational development is a process through which children, families and communities move toward wholeness of life with dignity, justice and hope. The scope of transformational development includes social, spiritual, economic, political, and environmental aspects of life at the local, national, regional and global levels”[vi].

This definition of transformational development gives a limited sense of its core values which derive from its origins in a 1983 conference of evangelical Christians, from which one derived definition is: “Transformation is to enable God’s vision of society to be actualized in all relationships, social, economic and spiritual, so that God’s will may be reflected in human society and his love be experienced by all communities, especially the poor”[vii].

The terminology of transformation was specifically embraced by the conference in opposition to a prevailing view of development that was seen as “intrinsically related to a mechanistic pursuit of economic growth that tends to ignore the structural context of poverty and injustice and which increases dependency and inequality”[viii].  It thus sets itself in opposition to the ideas of structural transformation and, notwithstanding its strongly anti-secular and evangelical core, its social action strand has many affinities with the human development paradigm given concerns to address poverty, health, education, injustice and inequality[ix].

While there is a big-picture vision (e.g. the attainment of the Kingdom of God), the actual focus tends to be much more human-scale.  Transformation in practice focuses on the personal transformation of individuals within their communities to “facilitate the acceptance and application of the values of the kingdom of God” including “freedom, stewardship, generosity and selflessness, reconciliation, grace and compassion for the excluded”[x].

Of relevance to DX4D, transformational development takes a balanced view of technology, recognising that “technology and science are an inseparable part of working for human transformation” but that technology must not be fetishised as it is “a false god … that speaks to us of power, not limits; speaks to us of ownership, not stewardship; speaks to us only of rights, not responsibilities; speaks to us of self-aggrandizement, not humility”[xi].  Transformational development thus argues for technology to be seen only as one tool among many, and that central to transformation should be development of individuals, their values, and their relationships.  That transformation of relationships extends to a need for change in wider “social structures that exploit and dehumanize”[xii].

There is also criticism of bandwagon-jumping: widespread and inappropriate adoption of the transformation label without staying true to its underlying values (“a vision of society where God’s will was done and his love experienced”): “many organizations adopted and used transformation to describe any and every form of mission and involvement with poor people from welfare based development backed by a spiritual message, to plain economic growth without any spiritual input at all”[xiii].  The same risk occurs with DX4D: that incremental digitalisation initiatives are inappropriately labelled as “digital transformation”.

One possible reason this mis-labelling has occurred with transformational development, however, is because it has been more of “a narrative, a framework, a way of thinking” rather than either a clear theory of transformation (as offered by structural transformation) or a clearly-defined set of practices that can be followed in the field[xiv].  DX4D similarly could benefit from strong theorisation underpinning clear guidance on practice.

3. Transformation Studies

“Transformation studies, also known as transformative studies, refer to an interdisciplinary field of research and scholarship that focuses on understanding and analyzing processes of fundamental change in various domains of human life and society. These changes can encompass a wide range of areas, including individual transformation, cultural shifts, social and political change, technological innovations, and environmental transformations. Transformation studies aim to explore the underlying causes, mechanisms, and implications of such changes.”[xv]

As per the quote, transformation research broadly can be seen as interdisciplinary and as covering a wide range of theorisations, research approaches and methods[xvi].  However, a particular approach has arisen in application to development, of what could be called transformative development studies or transformative global studies, that can be related to a post-structural, post-colonial development paradigm.

Where structural transformation is strong on theory with some implications for practice, and transformative development is a-theoretical and focussed on vision-based practice, transformative development studies (TDS) is more of a way of doing research.  At root, TDS challenges the way in which knowledge is produced.  Study of DX4D would thus begin by questioning the mode of study and seeing “transformative scholarship” as the starting point.  Any research should be founded on a “counter-Orientalist, post-Eurocentric … process of de-colonizing knowledge”[xvii].

From a TDS perspective, technology cannot certainly deliver particular transformations and it is thus a direct challenge to the views of structural transformation and even transformational development about technology.  Instead, “transformation is an open-ended, highly unpredict­able (uncertain) process resulting from the interactions between human as well as non-human actors”[xviii].  The interest here is more in the process of transformation than its outcomes, with the latter part of the quote suggesting DX4D should be studied through lenses such as those of actor-network theory, to understand how networks of transformation interact and build or disperse.

Like transformational development, transformative development studies challenges conventional notions of development, seeing them as associated solely with positive, progressive improvement.  Instead, to the extent TDS is interested in the wider outcomes of transformation, it would advocate that DX4D be interrogated for all impacts; asking who benefits from transformation, but also who loses, and why.

Conclusion

These three discourses on development as transformation do not represent the totality of the picture.  For example, one can find discussion of transformative development taken to mean generic change to social structures that challenges existing dispositions of power[xix].

In addition, while structural transformation is widely understood within development economics, transformational development and transformative development studies represent limited niches that have yet to be widely recognised within development studies more broadly. However, these perspectives do provide three quite different views of transformation and three quite different intellectual substructures that could be used for future DX4D research and practice.

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[i] Herrendorf, B., Rogerson, R., & Valentinyi, A. (2014). Growth and structural transformation. Handbook of Economic Growth, 2, 855-941.

[ii] Syrquin, M. (2006) Structural transformation. In: The Elgar Companion to Development Studies, D.A. Clark (ed), Edward Elgar, Cheltenham, UK, 601-607.

[iii] Herrendorf, B., Herrington, C., & Valentinyi, A. (2015). Sectoral technology and structural transformation. American Economic Journal: Macroeconomics, 7(4), 104-133.

[iv] Berger, T., & Frey, C. B. (2016). Structural Transformation in the OECD: Digitalisation, Deindustrialisation and the Future of Work. OECD, Paris.

[v] Syrquin (ibid.)

[vi] Byworth, J. (2003). World Vision’s approach to transformational development: Frame, policy and indicators. Transformation, 20(2), 102-114.

[vii] Samuel, V. & Sugden, C. (1999). Mission as Transformation. Regnum, Oxford.

[viii] Anon (1984) Social transformation: the Church in response to human need – Wheaton ’83 Statement. Transformation, 1(1), 23-28

[ix] Anon (ibid.), Byworth (ibid.)

[x] Sugden, C. (2003). Transformational development: Current state of understanding and practice. Transformation, 20(2), 71-77.

[xi] Myers, B. L. (2011). Walking with the Poor: Principles and Practices of Transformational Development. Orbis Books, Maryknoll, NY.

[xii] Anon (ibid.)

[xiii] Sugden (ibid.)

[xiv] Sugden (ibid.)

[xv] OpenAI (2023, Oct 31) GPT 3.5: “What are transformation studies?”. Retrieved from https://chat.openai.com

[xvi] Merkel, W., Kollmorgen, R. & Wagener, H.-J. (2019) Transformation and transition research. In: The Handbook of Political, Social, and Economic Transformation, W. Merkel, R. Kollmorgen, H.-J. Wagener (eds), Oxford University Press, Oxford, UK, 1-14.

[xvii] Hosseini, S. H., Goodman, J., Motta, S. C., & Gills, B. K. (2020). Towards new agendas for transformative global studies: an introduction. In: The Routledge Handbook of Transformative Global Studies, S.H. Hosseini, J. Goodman, S.C. Motta & B.K Gills (eds), Routledge, Abingdon, UK, 1-10.

[xviii] Alff, H. & Hornidge, A.-K. (2019). ‘Transformation’ in international development studies. In: Building Development Studies for the New Millennium, I. Baud, T. Kontinen & S. von Itter (eds), Palgrave Macmillan, Cham, Switzerland, 141-162.

[xix] Koff, H., & Maganda, C. (2016). The EU and the human right to water and sanitation: Normative coherence as the key to transformative development. The European Journal of Development Research, 28, 91-110.; Kontinen, T. & Holma, K., (2020). Introduction. In: Practices of Citizenship in East Africa: Perspectives from Philosophical Pragmatism, K. Holma & T. Kontinen (eds), Routledge, London, 1-12.

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13 Principles for DX4D Research and Consulting

Richard Heeks, Bookie Ezeomah, Gianluca Iazzolino, Aarti Krishnan, Rose Pritchard, Jaco Renken & Qingna Zhou

What good-practice principles can be drawn from the literature on digital-transformation-for-development (DX4D)?

“Digital transformation” has become something of a buzz term within international development, with recent release of DX4D policies, strategies, reports, briefings, programmes and projects.  Alongside this comes a growing body of more academic literature.

From a review of that literature – learning from both shortcomings and insights – a multi-disciplinary, multi-national team from the University of Manchester’s Centre for Digital Development, drew out a list of 13 DX4D principles.  We do not claim these to be the last word on the subject.  Instead, they can be used as a starting point for DX4D evaluation.

Intended particularly for use in DX4D research and consulting – targeting especially how we understand DX4D – the principles could also be modified for analysis of DX4D policies and strategies; a task on which we are currently working.

PRINCIPLE 1: DX4D should incorporate a (single) definition of digital transformation.
It is surprising how many documents talk about digital transformation without ever defining what it means.  (Our simple definition of DX4D: “radical change in development processes and structures enabled by digital systems”)

PRINCIPLE 2: the extent of change envisaged and incorporated in DX4D must be transformative; involving significant systemic disruption.
Too often it’s seen as the bottom half of this diagram when it should be the top half

Source

PRINCIPLE 3: although it necessarily involves technological changes to digital data and systems, digital transformation for development involves and requires broader, parallel transformative changes in structural relations, development processes, formal/informal institutions, and resource distributions.
To be truly transformative, there need to be significant changes in socio-economic structures: power relationships, value chains, organisational hierarchies, law and policies, norms and values.

PRINCIPLE 4: digital transformation impacts both organisations and societies, and macro-scale, societal transformation must be incorporated into the understanding of DX4D.
DX4D isn’t just about digitalisation within organisations but about broader, higher-level change across societies and their economies.

PRINCIPLE 5: digital-transformation-for-development derives from the micro-level, proactive actions of individuals but both creates and responds to macro-level societal changes deriving from digitalisation: digital-transformation-of-development.
This is very similar to the differentiation in development studies between two things: a) imminent development, seeing DX4D as the intentional actions of individuals and organisations; and b) immanent development, seeing DXoD as broader changes that emerge over time

PRINCIPLE 6: transformation of digital ecosystems is not the goal of digital-transformation-for-development; development – understood as the transformation of societies – is.  Digital-transformation-for-development should be explicit about the developmental transformation that it is seeking to bring about, or wishes to emerge
For example, this could be through express reference to the development paradigm that encompasses the desired societal transformation.  See our prior blogpost summarising the different transformation goals of different paradigms.

PRINCIPLE 7: digital-transformation-for-development overall is not associated with any specific digital technology, but it could be associated with new “Development 4.0” models.
As yet, though, there has been no categorisation of “Development 4.0” models: ways in which the potentially-transformative affordances of digital technologies can be used to reinvent traditional approaches to delivery of the SDGs.

PRINCIPLE 8: even allowing for islands of significant digitalisation – which may or may not be transformative – digital-transformation-for-development is a future more than present phenomenon.
Overall, digital development to date has been incremental in its impact, so digital transformation in the global South is as yet just at a formative stage.

PRINCIPLE 9: the impact of digital-transformation-for-development emerges not deterministically from technology alone but from a mix of social and technological factors.
Technology (the trajectory of which is itself heavily shaped by social context) may alter the landscape of development, but it is social factors that tend to shape the specific impact path taken through that landscape.

PRINCIPLE 10: there must be recognition of both positive and negative impacts associated with DX4D because, without this, there can be no understanding of, or attempt to mitigate DX4D’s downsides.
DX4D may be especially associated with two mechanisms that increase inequality: the digital divide (rising gaps between those included in and excluded from DX4D systems) and adverse digital incorporation (rising gaps between different included groups such as owners vs users of DX4D systems).

PRINCIPLE 11: alongside traditional ICT4D barriers, DX4D faces barriers of a specific size and nature due to the scope of transformation that it entails.
The specific barriers would include things like absence of transformative leadership, and presence of barriers to structural change.

PRINCIPLE 12: implications or recommendations for DX4D practice should be provided wherever feasible, taking into account the specificities of digital-transformation-for-development.
Recommendations to date have tended to cover traditional digitalisation strategy or ICT policy, not recognising the ways in which DX4D is different.

PRINCIPLE 13: DX4D recommendations will need to cover not just the content of organisational (private, public, NGO and international agency) strategy and government policy but also their underlying processes and structures.
This is a fairly standard prescription: that recommendations should cover not just the what but also the who and how of strategy-/policy-making and implementation.

As noted, these are seen as a starting point, and we welcome suggestions for amendments and additions to guide DX4D research and consulting. For further details, please see the full paper, “The Principles of Digital Transformation for Development (DX4D): Systematic Literature Review and Future Research Agenda”.

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Latest Digital Development Outputs (China, Platforms, Transformation, Water) from CDD, Manchester

Recent outputs – on China digital; Digital platforms; Digital transformation; Digital water – from Centre for Digital Development researchers, University of Manchester:

CHINA DIGITAL

“China’s Digital Expansion in the Global South: Systematic Literature Review and Future Research Agenda” by Richard Heeks, Angelica V Ospina, Christopher Foster, Ping Gao, Xia Han, Nicholas Jepson, Seth Schindler & Qingna Zhou, identifies from a review of literature what is already known about China’s digital expansion in the global South and, from this, outlines a future research agenda.

“The Effects of R&D and its Different Types on Firm Productivity: Evidence from China” by Yuanyuan Guo, Ping Gao & Daojin Cheng, estimates the effects of R&D and its different types, including research activity and development activity, on productivity using panel data consisting of 1,808 Chinese listed manufacturing firms from the period 2006-2015. Our empirical evidence implies that firms need to optimize the composition of R&D expenditure in order to realize sustained productivity growth.

DIGITAL PLATFORMS

“Gaming the System: Tactical Workarounds and the Production of Antagonistic Subjectivities among Migrant Platform Workers in Italy” (open access) by Gianluca Iazzolino & Amarilli Varesio, examines how migrant food delivery couriers in Italy react to and hijack gamification techniques designed to increase productivity and control. It describes the sharing of accounts among workers and recasts “gaming the system” as a form of everyday resistance.

“Gendered Implications of the Waves of COVID-19 and Economic Upgrading Trajectories in Digital Value Chains: Insights from Kenyan Agro-Platforms” (open access) by Aarti Krishnan, Monica Nganga & Tim Foster, attempts to unpack economic upgrading through the different regimes of COVID-19, illustrating the dynamic effects experienced by women living through the shock.

DIGITAL TRANSFORMATION

“Organisations Lead Digital Transformation for Development: So What?” (blog) by Jaco Renken argues that organisations sit at the heart of Digital Transformation for Development (DX4D) in practice, and a better understanding of their role – their visions, the requisite competencies and the processes they follow – should be included in a future DX4D research agenda.

“Technology for Resilience amid COVID-19 Pandemic: Narratives from Small Business Owners in Kenya“ (open access version available) by Joshua Rumo, Leah Mutanu & Christopher Foster, explores claims around transformative digital technology adoption by firms during the pandemic. Using research amongst Kenyan SMEs, the reality of technology adoption involved “frugal innovations” and adaptation for resilience and survival.

DIGITAL WATER

“Smartening Up: User Experience with Smart Water Metering Infrastructure in an African City” (open access) by Godfred Amankwaa, Richard Heeks & Alison Browne, finds that smart water metering in one African city has been characterised by an incremental and utility-centric approach.

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Five Principles for Collective Digital Sovereignty

What would it mean for digital sovereignty to be collective, rather than individual or national?

Digital sovereignty has been growing as a narrative, arising from the perception of a lack of control over the data, the value, the trajectories, etc of digital systems.  The narrative has principally operated at two levels: the national and the individual[1].  National digital sovereignty looks to secure political and/or economic control for governments.  Individual digital sovereignty seeks to secure control, particularly over data, for individuals.

But there has been a missing middle with very little discussion of collective digital sovereignty[2], defined here as the ability of a group or community to exercise control over its digital environment, including the infrastructure, data, and platforms that are used within it.

Fractions of this can be found, especially if we conceive the collective as a low-income community in which the value of digital data, devices and infrastructure is extracted to the benefit of large corporations and/or the state.  Hence, ideas such as community wireless networks[3] or community data trusts[4].  Putting these and other ideas for the missing middle[5] together, five principles of collective digital sovereignty can be created:

1. Infrastructure: technology infrastructure is, as far as possible, based around open systems and standards, and owned, deployed and maintained by the collective
2. Data: a collective data governance model is applied that controls who accesses and who benefits from data generated by those within the collective
3. Capabilities: digital skills and knowledge are developed within the collective, enabling not just use of the technology but also understanding of the structural context of the technology
4. Platforms: the apps and platforms that structure economic and social interaction are, as far as possible, based on open software, developed participatively, and owned and managed collectively
5. Advocacy: the collective will advocate for higher-level discourse and policies and regulations that support the other principles of collective digital sovereignty

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[1] Pohle, J., & Thiel, T. (2020) Digital sovereignty, Internet Policy Review, 9(4)

[2] MTST (2023) Homeless Worker Movement in Brazil and the Struggle for Digital Sovereignty, Movimento dos Trabalhadores Sem Teto, Sao Paulo

[3] Keysar, H., Luning, E.C. & Untiedig, A. (2022) Prototypes as agents of transition: the case of DIY wireless technology for advancing community digital sovereignty, Journal of Peer Production, 15

[4] Singh, P.J. (2019) Data and Digital Intelligence Commons (Making a Case for their Community Ownership), Data Governance Network

[5] AdB (2017) Barcelona City Council Technological Sovereignty Guide, Ajuntament de Barcelona, Barcelona; Ricaurte, P. & Grohmann, R. (2021) Data sovereignty and alternative development models, Bot Populi, 22 Oct; MTST (ibid.);

Lessons for Other Countries from China’s Crackdown on Big Tech

What can low- and middle-income countries learn from China’s recent approach to regulation of big tech?

What Happened?

China’s digital economy can be categorised into three phases[1]: a more open phase starting in the 20^th century that encouraged foreign investment and collaboration; a focus on state support to build national and then global digital champions; and most-recently some degree of state backlash against the monsters it had helped create.

The straw that broke the camel’s back and made the third phase explicit was a speech by Jack Ma, founder of Alibaba, on 24^th Oct 2020 critical of recent attempts at financial regulation by agencies of the Chinese state.  However, plans for tighter regulation of big tech in China had been underway since 2018, and actions on the wider digital economy such as fintech lenders had begun even earlier.[2]  Call it “crackdown” or “rectification”, the Chinese state introduced during 2020 and, especially, 2021 a series of measures that ran alongside a new narrative asserting that action was required in the digital economy in order to “limit the disorderly expansion of capital” and to deliver “common prosperity”.[3]

There were new financial rules, ensuring large fintech firms had much greater funds to cover the loans they were making, and banning edtech firms from accepting foreign investment and, effectively, preventing them from making a profit.  Anti-monopoly guidelines included new legal rules on assets intended to force break-ups and sell-offs, and to open up e-commerce marketplaces for smaller enterprises.

Tighter data rules arose with both the Data Security Law and Personal Information Protection Law coming into effect during 2021 and being used to provide greater state oversight over localisation, export and privacy of data held by big tech. As part of this, more than 100 firms were investigated for claimed illegal collection of data.

Redistributive regulations encouraged or forced redistribution of big tech profits to workers or to other pro-equality projects.  Other actions included restrictions on the number of hours per week minors could spend gaming, bans on cryptocurrency, and tax investigation of online influencers.

What was the Impact?

Overt effects noted so far of the increased regulation have been manifold[4].

Direct impacts have included some delinking from foreign investment with, for example, the suspension of Ant Group’s and ByteDance’s US IPOs.  There has been a substantial loss in market value of China’s big tech firms – hundreds of billions of US dollars-worth of share price losses; particularly hitting foreign investors which, in turn, has led to a significant decrease in foreign investment in China’s digital economy. More specific direct impacts include Didi being blocked from adding new users and having its app removed from app stores; Meituan being made to raise wages and provide insurance for its workers, and Ant Group and others having to share data with public agencies.

Regulatory pressures have encouraged the break-up of big tech firms or their withdrawal from certain investments, the most recent being Alibaba’s March 2023 announcement of its separation into six different business units. While adhering to anti-monopoly rules and signalling a lack of intent to empire-build, these partitions have also hampered firms given “that a crucial aspect of the business model adopted by these tech giants is building an integrated ecosystem involving multiple complementary industries”[5]. Local investment in the digital economy has been reduced, with estimates of more than 200,000 job losses in internet companies in the nine months from mid-2021 to spring 2022, alongside less concrete or quantifiable outcomes in relation to reduced levels of digital innovation.

Other impacts were more notable for their symbolism: the heads of tech firms including Alibaba, Pinduoduo, ByteDance, Meituan and Didi stepping down and/or disappearing from public sight; huge, billion-dollar donations by tech firms to “common prosperity” funds and other philanthropic endeavours; fines costing hundreds of millions or even billions of dollars for many tech firms including Baidu, Alibaba, Tencent, Meituan, ByteDance and Didi for abuse of monopoly or breach of data regulations.

What’s so far unclear is whether the measures taken against big tech have reduced any of the four big inequalities in China: high concentration ratios and monopolies in key digital markets; income/wealth inequalities between rich and poor; geographical inequalities between regions and between urban and rural; distributive inequalities between capital and labour.  Recent papers[6] discuss the relation of digital to common prosperity but so far only show the potential for digitally-enabled reduction in geographical inequalities on the basis of historical data.

Given that a number of the listed impacts have not been in the national interest, some roll-back occurred from 2022 onwards[7]. Early in 2022 there were some more positive statements from government officials about the value of the platform economy, then more explicit support in May for tech firms seeking domestic and overseas listings. By 2023, Didi was allowed to register new users, new licences for gaming firms were being issued, Jack Ma reappeared in mainland China, and officials were explicitly reassuring tech firms about some easing of the earlier regulatory tightening; albeit making clear there would be no return to the pre-2020 situation.

Why did it Happen?

For sure, there may have been economic concerns at the highest levels of the Communist Party about financial instability and economic inequality, but the core rationale for the measures comes down to one word: control.

This came particularly with the run-up to the 20^th Party Congress in 2022 that gave Xi Jinping an unprecedented third term, but more generally as part of Xi Jinping’s steady reversal since 2012 of the relatively decentralised and distributed model of power that had existed since the time of Deng Xiaoping[8].  Three different domains of centralisation of control can be identified[9].

Social control: seeking to maintain the legitimacy of the Party by giving at least the appearance, during a period of Covid disruption and slowing growth, of addressing social issues like inequality, digital exclusion, platform lock-in of consumers and small sellers, resentment of middle-class parents paying edtech platforms for education the state did not provide, and social ills like gaming addiction.  Alongside this, alternative, critical narratives were silenced with, for example, initial action against Jack Ma and Ant Group making clear that public dissent against Party policies would not be tolerated.

Economic control: growth of the private sector and the shrinking role of state-owned or -affiliated enterprises within the overall economy has left the state with fewer direct levers of economic control.  The state has thus taken direct stakes in a number of big tech firms and through this and other means, placed party members onto company boards in order to have a measure of direct control.  The financial and other measures have sought to stabilise and control markets.  Alongside this, the measures have sought to reduce the extent of foreign economic control over Chinese big tech, even where there are foreign investors.  They have also sought to help shift resources both within and between tech firms from digital activities with lower national priority (such as e-commerce and social media) to those with higher national priority (such as AI, chip production and quantum computing).

Political control: growth, profile and political connections of big tech leaders and firms in China had made them into new loci of power; something seen as a directly challenge to the Party.  In general, all of the regulatory actions were an assertion of state control over big tech, especially as data – named as a factor of production since April 2020 and a growing source of power – is now being harvested and analysed in huge quantities within these firms.  In parallel, there were even-more covert objectives with action against Ant Group seeking to deny windfall profits that political rivals of Xi Jinping would have gained had the company been listed overseas.  Punitive actions against Didi after it proceeded with an overseas IPO against state wishes also sent a symbolic message about who was in charge.

What are the Lessons?

China is a global digital superpower with unique features including the power and capacity of the state, the size of the national digital economy, and the size and reach of its digital firms.  So the idea that global South governments might replicate what China has done does not make sense.

However, a few lessons can be drawn.

1. Politics Trumps Economics in Policy-Making.  China’s recent policies have damaged its digital multinationals and its digital economy.  But digital policy has been made – as policy often is – for political much more than economic reasons.  Digital policy advice and digital policy research needs to recognise the primacy of politics.

2. Policy Responsiveness is Good; Policy Uncertainty is Bad.  Likely recognising that it had gone too far, the Chinese state reversed direction a bit from 2022.  Changing policy direction in response to the negative impacts of policy is highly recommended.  What is not recommended is the uncertainty created by what can be perceived as two significant changes in direction in three years including a partial backtrack.  That uncertainty is heightened when policy-making is highly-centralised and without transparency.

3. Policy Structures Matter.  Digital policy advice and analysis focuses a lot on the content of policy but much less on policy structures.  China’s experience shows how structures matter[10].  It is not a specific feature of recent policy but China’s digital policy is fragmented across a large number of agencies. This has been partly organic as digital constantly raises new issues that different traditional agencies may try to deal with but which also encourage formation of new agencies.  It has also been partly deliberate to avoid creating a single state agency powerbase for digital policy that could challenge central authority.  But this complicates policy-making and raises the likelihood of policy contradictions that harm the digital economy with, for instance, mixed messages having been given by different agencies during the clampdown.  Likewise, heavy centralisation of policy can give a strong sense of direction if chosen correctly, but it may also amplify policy errors and lead to policy inertia if all decisions have to run through a central point.  Whatever the rights and wrongs, it means that policy needs to be built on appropriate structures as much as appropriate content.

4. Targeted Regulation Works Better than Blanket Regulation.  China’s recent policy initiatives have been somewhat targeted[11].  For example, while cracking down on e-commerce or data issues within the BAT big three of Baidu, Alibaba and Tencent, there has been “little regulatory interference” and, indeed, state support for these companies’ work on the “deep tech” priorities of the state such as AI and high-end chip production.  That differentiated approach to digital policy has helped more than an indiscriminate crackdown would have.

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[1] To, Y. (2023) Friends and foes: rethinking the party and Chinese big tech. New Political Economy, 28(2), 299-314

[2] Creemers, R. (2023) The Great Rectification: A New Paradigm for China’s Online Platform Economy. Available at SSRN

[3] Economist (2021) China’s government is cracking down on fintech. What does it want?, Economist, 13 Mar; Economist (2021) China’s rulers want more control of big tech, Economist, 8 Apr; Economist (2021) Didi’s removal from China’s app stores marks a growing crackdown, Economist, 5 Jul; Poswal, V. (2022) Xi Jinping’s Crackdown on Big Tech-Companies. International Journal of Multidisciplinary Educational Research, 11(5), 67-70; Wu, Y. (2022) Understanding China’s Digital Economy: Policies, Opportunities, and Challenges, China Briefing, 11 Aug; Collier, A. (2022) China’s Technology War: Why Beijing Took Down Its Tech Giants. Springer Nature; Creemers (2023)

[4] Economist (2021, 8 Apr); Economist (2021, 5 Jul); Pathak, S. (2021) China’s Tech Crackdown: Why Now. Science, Technology and Security Forum, Manipal University, Karnataka; Poswal (2022); Sun, X. (2022) Decoding China’s” Common Prosperity” Drive, LSE Ideas, April; Collier (2022); Interesse, G. (2023) Is China’s ‘Tech Crackdown’ Over? Our 2023 Regulatory Outlook for the Sector, China Briefing, 22 Feb; Economist (2023) Alibaba breaks itself up in six, Economist, 30 Mar

[5] Sun (2022)

[6] E.g. Jiechang, X., & Cheng, L. (2022) Empowerment of Common Prosperity through Digital Economy: Pathways and Policy Design. China Economic Transition, 5(1), 41-61; Zhao, T., Jiao, F., & Wang, Z. (2023) Digital economy, entrepreneurial activity, and common prosperity: Evidence from China. Journal of Information Economics, 1(1), 59-71

[7] To (2023); Interesse (2023)

[8] Sun (2022)

[9] Economist (2021, 8 Apr); Economist (2021) What tech does China want?, Economist, 9 Aug; Pathak (2021); Economist (2021) China’s communist authorities are tightening their grip on the private sector, Economist, 20 Nov; Poswal (2022); Sun (2022); To (2023)

[10] Sun (2022)

[11] To (2023)

Development Transformation as the Goal for Digital Transformation

Richard Heeks, Bookie Ezeomah, Gianluca Iazzolino, Aarti Krishnan, Rose Pritchard & Qingna Zhou

There’s a lot of talk currently about digital transformation for development.  Sometimes styled “DX4D”, a quick definition would be radical change in development processes and structures enabled by digital systems.

Digital transformation is thus not a goal.  Instead, development transformation is the goal and starting point.  But what kind of development transformation?

In this post, we summarise what development transformation would mean under different development paradigms, and some implications for digital.  The table below is not exhaustive of the various paradigms and it rather brutally simplifies rich and complex ideas.  However, it does help clarify two key DX4D tenets:

• Vision Matters: unless you know where you want to get to, digital can’t help take you there.
• Visions Differ: different paradigms aim for very different destinations and, hence, different journeys in the application of digital.

If you have paradigms you’d like to add or you have improvements to offer on what’s in the table, do let us know.

Development Paradigm	Essence?	Transformation?	Digital Implications?
Neoliberal	Markets and market relations are the central foundation for economic development.  They, and not government regulation or vested interests, are the best way to allocate development resources and to generate productivity improvements and growth.  The state acts to support market-driven development. Neoliberalism is thus about the reformatting of politics, society and individuals according to market logics, the pursuit of profits, and individual responsibility principles.	Stabilisation to reduce government expenditure.  Liberalisation to roll back state regulation, subsidies and other interventions in markets and the private sector.  Privatisation to transfer ownership from public to private sector.	Digital, particularly via platforms, must enable the formation and presence of markets in all sectors, and a step change in market functioning via datafication and machine-readability of market actors and processes. Digital will also enable the development of private sector responsibility for public service delivery, and major improvements in efficiency of remaining public sector functions.
Structuralist	Particular socio-economic structures inhibit development.  For dependency variants, it is unequal relationships of exchange between core and periphery, whether understood in terms of countries, regions, or more immaterial geographies.  For Marxist and related anti-capitalist paradigms, it is unequal relationships of exchange between capital and labour.	The exploitative socio-economic structures must be broken away from and/or replaced.  From a dependency perspective, at the extreme, this means autarky and a focus on localised systems of production and consumption.  From a Marxist perspective, it means the end of capitalism and its replacement with structures of common ownership.	Digital must support radical structural change based around localised production and/or cooperative or similar ownership structures.
Sustainable	Ensuring resource usage does not compromise the ability of future generations to meet their own needs; with variants ranging from green growth through to de-growth.	Major reductions in resource usage including improvements in efficiency of resource-using processes.  Major reductions in polluting outputs from processes. Internalisation of negative environmental externalities so as to gauge the true cost of economic growth.	Digital must support a step-change in resource usage and polluting outputs of all economic and social processes, including those involving digital itself.  Digital must also support environmental mapping and monitoring to track progress of sustainability.
Human Development	Development as freedom; in particular economic, political, social, security and informational freedom for all so that no-one is left behind and all have the opportunity to be and to do what they wish.	Changing contexts so that there is equality of opportunity and equality of choice; especially for those currently denied those opportunities.	Digital must be not just accessible but usable and appropriable by all.  It must then support the ability of all to choose the kind of lives and livelihoods that they value; thus requiring some customisation to individual contexts rather than a blanket equality of access to assets, institutions and livelihoods.
Decolonisation	Reversal of the current and legacy negative impacts of colonisation.	Enabling sovereignty and “self-determination of indigenous peoples over their land, cultures, and political and economic systems”[1].  Also understood – and drawing on the post-development roots of one strand of decolonisation – as the identification, challenging and revision or replacements of “assumptions, ideas, values and practices that reflect a colonizer’s dominating influence and especially a Eurocentric dominating influence”[2].	Digital must be accessible, usable and appropriable by indigenous peoples, enabling them to exercise self-determination.  Digital sovereignty will enable local “control over digital assets, such as data, content or digital infrastructure, or over the use of those assets”[3] and prevent uncontrolled extraction of value from these assets by others. For the latter understanding of decolonising transformation, digital must empower those who have been disempowered by Eurocentric domination of epistemics and discourse, and enable them to engage with and challenge that domination.

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Photo by Javier Miranda on Unsplash

[1] https://globalsolidaritylocalaction.sites.haverford.edu/what-is-decolonization-why-is-it-important/

[2] https://www.merriam-webster.com/dictionary/decolonize

[3] https://oxil.uk/publications/2021-01-20-plum-digital-sovereignty/Plum_Aug_2020_Digital_Sovereignty_states_enterprise_citizens%20%281%29.pdf

Latest Digital Development Outputs (China, Data, Economy/Platforms, Inclusion, Water, Rights, Sustainability) from CDD, Manchester

Recent outputs – on China Digital; Data-for-Development; Digital Economy / Platforms; Digital Inclusion; Digital Water; Rights; and Sustainability – from Centre for Digital Development researchers, University of Manchester:

CHINA DIGITAL

“China’s digital expansion in the global South” presents recordings of nine presentations at a CDD international workshop that discusses the implications for the global South of China’s emergence as a digital superpower.

“Understanding the evolution of China’s standardization policy system” (open access) by You-hong Yang, Ping Gao & Haimei Zhou, investigates the evolution of China’s technology standardization policy system in the period from 1978 to 2021.  

DATA-FOR-DEVELOPMENT

A DC State of Mind? A Review of the World Development Report 2021: Data for Better Lives by Hellen Mukiri-Smith, Laura Mann & Shamel Azmeh, reviews the World Development Report (2021) on data governance.

DIGITAL ECONOMY / PLATFORMS

“Examining ecosystems and infrastructure perspectives of platforms: the case of small tourism service providers in Indonesia and Rwanda” (open access version available) by Christopher Foster & Caitlin Bentley, analyses tourism platforms from the perspective of small and marginal service providers. It is useful to move away from ideas of platform leaders organising ecosystems from the top-down, towards more emergent behaviours of service providers in multi-platform environments.

Automation and industrialisation through global value chains: North Africa in the German automotive wiring harness industry by Shamel Azmeh, Huong Nguyen & Marlene Kuhn, examines the implications of automation on the global map of production and the position of developing countries in global value chains. Through the case of the German automotive wiring harness industry, we examine the implications of ongoing automation processes on production in North Africa.

“Digital public goods platforms for development: the challenge of scaling” (open access) by Brian Nicholson, Petter Nielsen, Sundeep Sahay & Johan Saebo.  We articulate the notion of digital global public goods and examine the development of DHIS2, a global health platform inspired by public goods, focusing on the paradoxes that arise in the scaling process. A presentation of the paper to the Pankhurst Institute, University of Manchester is available on YouTube.

DIGITAL INCLUSION

“Digital inequality beyond the digital divide: conceptualizing adverse digital incorporation in the global South” (open access) by Richard Heeks, presents a new model to understand how inclusion in – rather than exclusion from – digital systems leads to inequality.

“Revisiting digital inclusion: a survey of theory, measurement and recent research” (open access) by Matthew Sharp, sets out a framework of core components of digital inclusion, surveys current measures of digital inclusion, and makes suggestions for how future research could be more rigorous and useful.

DIGITAL WATER

“Water ATMs and access to water: digitalisation of off-grid water infrastructure in peri-urban Ghana” (open access) by Godfred Amankwaa, Richard Heeks & Alison L. Browne, finds water ATMs to be incremental infrastructures delivering relatively limited and operational-level value, but also producing new and contested socio-material realities.

RIGHTS AND DIGITAL

“RaFoLa: A Rationale-Annotated Corpus for Detecting Indicators of Forced Labour” (open access) by Erick Mendez Guzman, Viktor Schlegel & Riza Batista-Navarro, describes a dataset of news articles categorised according to forced labour indicators. The articles were annotated with rationales, i.e. human explanations for placing them under specific categories, to support the development of explainable AI systems.

“Hustling day in Silicon Savannah: datafication and digital rights in East Africa” (open access) by Gianluca Iazzolino, Michael Kimani & Maddo, is a cartoon on the winners and losers in Kenya’s booming tech scene. It translates, for a non-academic audience, the authors’ research on how digital technologies are reshaping the informal economy in the global South.

SUSTAINABILITY AND DIGITAL

“Exploring financing for green-tech SMEs in East Africa: current trends and risk appetite” (open access) by Aarti Krishnan, reviews the financing of green-tech SMEs in East Africa including different financing at different enterprise lifecycle stages, in different sectors, and across different countries.

“Applications of Industry 4.0 digital technologies towards a construction circular economy: gap analysis and conceptual framework” by Faris Elghaish, Sandra T. Matarneh, David John Edwards, Farzad Pour Rahimian, Hatem El-Gohary & Obuks Ejohwomu, investigates the interrelationships between emerging digital technologies and the circular economy, concluding with the development of a conceptual digital ecosystem to integrate IoT, blockchain and AI.

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Antecedents of Significant Digital Development Research

This post is a cheat because it’s actually summarising a paper on organisational – not digital development – research.

It’s by the leading organisational theorist – and confutation of nominative determinism – Richard Daft, and I read it just before I started my PhD.

Based on a survey of organisational researchers, its findings feel relevant to digital development.  Significant research . . .

– Is an outcome of the researcher’s involvement in the real world

– Is an outcome of the researcher’s own interests, resolve and effort

– Is chosen on the basis of intuition

– Is an outcome of intellectual rigour

– Reaches into an uncertain world to produce something that is clear, tangible and well-understood

– Focuses on real problems

– Is concerned with theory, with a desire for understanding and explanation

Not-so-significant research is the opposite: expedient, quick and easy, lacking personal commitment from the researcher, lacking theoretical thought and effort, and so on.

While planning and clarity mark out the latter stages of significant research, it is the outcome of an organic process of intuition, integration of ideas from different fields or chance meetings, that starts with uncertainty.  Precisely planned, tidy, clean and clearly-defined research most likely leads to small results (research funders please take note!).

That all seems to fit equally-well with digital development research but, of course, these criteria come from a researcher perspective, not that of other stakeholders.  See what you think.

If you’d like to read the paper, it’s not so easy to find:

 – Daft, R. L. (1984). Antecedents of significant and not-so-significant organizational research. In: T.S. Bateman & G.R. Ferris (eds), Method and Analysis in Organizational Research. Reston Publishing, Reston, VA, 3-14.

Or, there’s a firewalled update:

– Daft, R. L., Griffin, R. W., & Yates, V. (1987). Retrospective accounts of research factors associated with significant and not-so-significant research outcomes. Academy of Management Journal, 30(4), 763-785.

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Income of Gig Work vs. Previous Job in Pakistan

Richard Heeks, Iftikhar Ahmad, Shanza Sohail, Sidra Nizamuddin, Athar Jameel, Seemab Haider Aziz, Zoya Waheed, Sehrish Irfan, Ayesha Kiran & Shabana Malik

Does the transition to gig work improve incomes in Pakistan?

Many workers join gig work platforms in the belief that their incomes will improve, but is this borne out in practice?  To investigate, the Centre for Labour Research interviewed 94 workers based on six platforms across three sectors: ride-hailing, food delivery, and personal care.

Of these, 51 were able to tell us what their previous monthly income had been in their most-recent employment prior to joining the platform[1].  Stated income varied from the equivalent of US$60 per month up to U$1,200 per month, and averaged US$220 per month[2].

After moving into gig work, average gross income was slightly higher, at US$240 per month but, as the graph below shows, there was a much more differentiated picture behind the average, with around 40% of respondents earning less gross income (red-bordered blue columns) than they had done previously.

However, as the graph also shows, things looked worse when comparing net income (orange columns).  For the great majority of prior jobs, work-related costs were small (only work-to-home transport, which we calculated based on typical commuting journeys in Pakistan to be just under US$18 per month; i.e. less than 10% of average gross income).  But for gig work – much of which relies on journeys by vehicle and continuous internet connectivity – the costs of petrol, maintenance and data eat heavily into gross income.  In addition, for some (only a few in our Pakistan sample) there are costs of renting their vehicle.[3]

These costs represented, on average, 65% of gross income and knocked average net income for gig workers down to just US$85 per month.  When we compare before-and-after for net income, then, we found more than 70% of our sample were earning less than in their previous job, and 45% earned over US$100 per month less.

This was especially an issue for ride-hailing drivers and it does reflect the particular circumstances during our interview period of late 2021 to early 2022: a drop-off in demand for travel due to Covid, and a steep rise in petrol prices.  Indeed, so bad was the problem that just over a fifth – 21 of the 94 – were reporting negative income.  That is, they were effectively paying to go to work as their costs exceeded their gross income; something to which the platforms responded in May 2022 by dropping the commission taken from drivers to 0%.

While recognising the challenging period for gig workers covered by our fieldwork, nonetheless, this does suggest that – by and large – gig work is not delivering the income boost that workers often hope for.  They may, for example, be lured by gross income figures, not realising how much lower net income will be.  Gig work does provide a livelihood – 40% of our sample were unemployed in the immediate period prior to joining – but it is not really fulfilling its promise.  It also falls far from decent work standards: five-sixths of those we interviewed took home less than a living wage.

If you’d like to know more, please refer to the 2022 Fairwork Report on Pakistan’s gig economy.

Acknowledgement: Fairwork is financed by the Federal Ministry for Economic Cooperation and Development (BMZ) commissioned by the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ).

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[1] Those who stated what their prior employment had been gave the following job descriptions: BPO operator, Teacher (2), Housekeeper, Shopkeeper, Gas company worker (2), Safety officer, Business person, Tanker driver, Ride-hailing driver with another platform (3), Traditional taxi driver (3), Farmer, Builder, Computer operator, Cook, Technician, Shop assistant, Domestic worker, Government worker

[2] This average is some way above the overall average earnings of US$140 per month but well below formal sector average monthly salary of US$480.

[3] For further detail, see this discussion of the breakdown of ride-hailing passenger payments.

Digital Inequality Beyond the Digital Divide

How can we understand digital inequality in an era of digital inclusion?

As the open-access journal paper, “Digital Inequality Beyond the Digital Divide: Conceptualising Adverse Digital Incorporation in the Global South” explains, the digital divide has been an essential and powerful concept that links digital systems with inequality.

But it is no longer sufficient.  A majority of the global South’s population now has internet access and is included in, not excluded from, digital systems.  Yet, as the figure below illustrates, that inclusion also brings inequalities – the small farmers in digital value chains losing out to large intermediaries; the gig workers whose value and data are captured by their platforms; the communities disempowered when they are digitally mapped.

Figure 1: From an Exclusion-Based to an Inclusion-Based Perspective on Digital Inequality

We need a new conceptualisation to explain this emerging pattern.  I refer to this as “adverse digital incorporation”, defined as inclusion in a digital system that enables a more-advantaged group to extract disproportionate value from the work or resources of another, less-advantaged group.

As shown below, I have inductively built a model of adverse digital incorporation, based around three aspects:

Figure 2. Conceptual Model of Adverse Digital Incorporation

Future digital development research can apply this model deductively to cases of digital inequality, and can further investigate the digitality of adverse digital incorporation. 

For digital development practitioners, the challenge will be to achieve “advantageous digital incorporation”: designing digital interventions that specifically and effectively reduce existing inequalities.  This means going beyond digital equity to digital justice: addressing the underlying and contextual causes of inequality not just its surface manifestations.

For further details, please refer to the paper; “Digital Inequality Beyond the Digital Divide: Conceptualising Adverse Digital Incorporation in the Global South”.

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