By Robert E. Litan

During this quantity, revered economists articulate the expected financial influence of the web among 2001 and 2006. Drawing on learn carried out by means of the Brookings and BRIE job forces, the authors tackle the internet's power affects on productiveness, costs and marketplace constitution.

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Extra info for Beyond the dot.coms: the economic promise of the Internet

Sample text

Likewise, as noted above, productivity improvements that result from more intensive use of the Internet in interactions between government and business will show up partly in lowering the cost of government itself and partly in reducing the costs to businesses of paying taxes, obtaining permits, and the like. Productivity growth in health care may also manifest itself in lower business costs.      Adding It All Up The evidence from the sector studies, when cumulated, leads to the following broad conclusions: —The potential of the Internet to enhance productivity growth over the next few years is real.

To the extent that the Internet reduces the cost of interaction between government and the private sector, part of the benefit will show up in private sector productivity. Part will also be reflected in lower government expenditures and greater citizen satisfaction, neither of which enters explicitly into productivity statistics. Education is also a large, information-intensive sector of the economy, where the long-run impact of information technology and the Internet may turn out to be considerable.

Charles Fine of MIT and Daniel Raff of the University of Pennsylvania examine the automobile industry—an important segment of manufacturing—and find multiple potential opportunities for Internet-aided increases in efficiency in this highly visible industry. They project productivity improvements in product development, procurement, and supply and in various aspects of the manufacturing process itself. They also explore the applicability to automobiles of the Dell model, under which customers specify exactly what features they want and the product is then built to their order and shipped directly from the factory.

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