Introduction

Technology has always played a vital role in economic development, but its impact has become
increasingly significant in recent decades. Technological advancements have led to new
Industries and Products, Increased Productivity, and Improved Efficiency in existing Industries.
This has resulted in economic Growth, Job creation, and higher living standards. Some specific
examples of the role of technology in the economy.

The development of E-commerce has revolutionized the retail industry. Online retailers can
reach a global audience and offer a wide range of products at competitive prices. This has led to
the closure of many traditional brick-and-mortar stores, but it has also created new jobs in the
logistics and customer service sectors.

E-commerce has also made it easier for small businesses to compete with larger retailers.
Technology is constantly evolving, and its impact on the economy is likely to continue to grow
in the years to come.

Economic development of all countries of the world. Economic development depends on

number of factors. Technology for economic development of any country is an important
factor. All developed and under developed countries economy, Agriculture, Industry, Transport,
Banking, Health, Education and Improved Technology in all sectors are trying to install.

Meaning of technology
Technology equipment and services for the production of economic resources or technologies
that facilitate learning.

Adoption of technology
Technology and developing countries by developed countries may not adopt product. Major
markets of advanced industrial countries, high income, ample capital resources, supported by
good management and technical skills are the least developed countries, small income, capital
shortages, and unskilled labor is abundant. Advance technology, so, what can be done for these
countries. Developing countries should adopt appropriate technology to provide the needed
employment is based. The development stage of the country’s current economic policy
framework should be within.

Role of Technology in Economy Development

Technology plays a crucial role in Economy Development due to following reasons:
 Increase in Labor Productivity: With labor productivity growth in the use of technology.
If we help the agricultural sector, for example, a farmer with tractor can work more than
ten farmers.

 More Human Capital: Human capital means skilled and educated labor force when we
increase the use of technology the skills in labor also increase; it leads to human capital
formation.

 Providing Better Living Standard: We enjoy living facilities per capita income and the
quality of life decision. Technology, national income and per capita income growth
using, is it leads to better quality of life.

 Rapid Increase in Supply: According to Keynes rapid increase in supply is possible with
the help of technology. If demand of a commodity increase, it is possible to match the
demand with the help of technology. It removes the danger of inflation.

 Trade: The basis of international trade is “a country exchanges its excess production
with the excess production of another country”. So with the use of technology
production and international trade also increase.

 Advancement in Infrastructure: Technology itself is the component of infrastructure.

With the use of advancement in technology we can improve .such as use of atomic
energy, use of gas in place of petrol, and computer etc.

 No Wastages of Resources: Technology helps in removing wastages of resources in

production. It is possible to have more output with same inputs in the presence of
technology.

 Cost Minimizing: According to the Gallbraith “The increasing use of technology in a

society as the efficiency increases. Growth of national income and expense control in
results

 Economics of Scale: It means that advantages are attached with high production level.in
this modern era we know that the use of technology production will increase as a result
cost will decrease and profit will increase.

 Improvement of Quality: When we use latest technology in the production of new goods
then their quality of product will improve. If we take the example of textile industry the
quality of machine made cloth is better than the quality of handmade clothes. And their
production will be more.
  Useful labor force: Skilled labor can also be used for more production. If labor will be
highly skilled than they know how to use the machines effectively. That can also be
profitable for the country and industry.

What is Technology and Why is it important

Economists define technology as Ideas, or knowledge, that help us produce output from inputs.
Having more technology means being able to produce more output with a given amount of
inputs.

Technology can be in different shape. It may be an Engineering Discoveries like Invention of

Airplane, Light Bulb, Basic knowledge like Calculus. Services concept like all-in-one shopping of
Wall Mart, ShopRite.

Technology is also important because regular inputs are characterized by diminishing returns
the more of an input we use, holding others constant, the less output each additional unit is
able to produce. However, since the same idea is available to the entire economy, we do not
run into diminishing returns with technology.

Technology turns out to have a very important role to play in overcoming the limitations
imposed by diminishing returns to labor and capital. At many points in history, prophecies of
doom have been announced based on the idea that scarcities in one input or another (land, oil,
people) will bring economic growth to a grinding halt. These prophecies have been disproven so
far mostly because of technological progress: we have learned to produce more with less of the
scarce inputs, thus reducing the dangers poseniteness of available resources

The Production of Technology

In order to understand the special nature of technology, we need to understand the under-lying
economics. Typically, we classify economic goods along two dimensions: Rivalry and
Excludability.

Excludability: The degree of excludability of a good is the extent to which the owner can
restrict access to the product to those who pay for the privilege of using the product.

Non-excludable goods often tend to have spillovers of costs or bents that are not captured by
the producer (owner) of the good; these are also known as externalities.

If these externalities are positive then the good is under-produced by the market; government
intervention to increase production may be necessary (public goods). Alternatively, the ex-
ternalities may be negative so that the good is over-produced by the market (tragedy of the
commons); government intervention to restrict production may be necessary.

Rivalry: A rival good is a good that when used by one person, cannot be used by another
person. Several people can simultaneously use a non-rival good; use by one does not preclude
its use by another.

The basic nature of non-rival goods implies that a lot of time and money must be spent to come
up with the product but once it is created the good becomes relatively easy to replicate.

New technology can be thought of as new ideas that enable us to produce more output with
the same amount of inputs. In the classication outlined above, ideas are non-rival: the use of an
idea by one does not preclude the use of an idea by another.

Problems being faced in diffusion of Technology.

Problems can be faced in the diffusion of the technology. Some problems are given below;

 Illiteracy problem: Literacy rate of developing country is very low. In Nigeria literacy rate
is 22% which is not very satisfactory. Due to illiteracy, people are not very aware of
Technology.

 Resources are misallocated: Misallocation of resources decreases the productivity of the

resources low productivity creates the problem of low income and saving capacity of
nation, so the people are unable to purchase modern technology.

 Lack of capital: In underdeveloped countries there is lack of capital due to low per capita
income. That’s why they cannot afford Machinery and New Technology to improve their
business or expand it.

 Lack of Efficient administration: In developing countries like Nigeria, Some Officers do

not know how to use the new technology and have no technical training .they have no
idea about use of new machines.

Measure to remove the problems

Different ways can be useful to remove the problems of technology diffusion.

 Services and training center: Training center can help to promote the economy to equip
the labor with training and technical skills

 Useful labor force: Skilled labor can used the advanced technology. To improve the
production and profit margin of the industry that can help the economy.
  Removal of tax: To encourage business savings, tax concessions should be allowed to
those who save higher ration of their profits and invested for import of technology.

 Efficient capital market: If we have an efficient market i.e. banks and financial
institutions then people would be induces towards savings and use for import of
technology

 Market problems: Due to limited markets and slow turn over use of modern technology
is not affordable

 Small incentives: Due to lack of incentives in Nigeria most of the people prefer to work
abroad. That’s why most of the skilled people prefer to work in other Countries.

 More guidance: Proper guidance should be provided to investors in technical, financial

and marketing matters. Many people have funds but are unable to invest due to
ignorance

 Educational facilities: In under developed countries maximum educational facilities

should be arranged for the people. Educated people can invent and innovate.

Conclusion
The importance of information technology in the present world cannot be underestimated as it
has dominated almost all the fields of business and industry including the service sector and
one having no touch with this technology would not be able to make any progress in the
century to come.

We can say that the importance of technology cannot be denied in order to achieve economic
development

References
Audretsch, D. B., Lehmann, E. E., & Wright, M. (2014). Technology transfer in a global economy.
The Journal of Technology Transfer, 39, 301-312.

Barry, A., & Slater, D. (2002). Introduction: the technological economy. Economy and society,
31(2), 175-193.

Bassanini, A., Scarpetta, S., & Visco, I. (2000). Knowledge technology and economic growth:
recent evidence from OECD countries. National Bank of Belgium Working Paper, (6).
Bhattacharya, M., Rafiq, S., & Bhattacharya, S. (2015). The role of technology on the dynamics
of coal consumption–economic growth: New evidence from China. Applied Energy, 154, 686-
695.

http://www.learningall.com/2012/07/role-of-technology-in-economic-development-in-
pakistan/#.UNdCZW_oSit