The Forum on the World Economic Order welcomed its third delegation of experts at the end of February for a seven day study tour focusing on the advancements and challenges of e-commerce and the digital economy both in the United States and around the world. The Forum hosted a delegation of ten participants from Brazil, Georgia, Germany, Honduras, India, Morocco, Russia, Tunisia, Turkey, and Ukraine to the program, which took place in Washington, DC and San Jose, CA. During the week, the delegation met with over 25 e-commerce and digtial economy practitioners in the U.S., representing the private sector, NGOs, non-profits, think tanks, academia, and state government.
The program began in Washington, DC and included meetings with Cisco, TechFreedom, the Bertelsman Foundation, Information Technology and Innovation Foundation, the National Retail Federation, Georgetown University, and the International Finance Corporation and World Bank. While in Washington, the delegation had the opportunity to discuss the current state of the digital economy with a particular focus on regulation and policy.
An important theme which emerged during the meetings in Washington, DC was the need for “smart” regulation, or regulation which fosters innovation and new technology while still providing a structure to keep companies from operating unrestricted. With this discussion came the realization that regulation often cannot predict the future of an industry, and therefore it is vital for policymakers to be aware of and adjust regulations that hamper advancement because they no longer apply to the current system. The group also explored ways to incorporate more of society into the digital economy, so that the major gains of technology are not restricted to a privileged few. The smartphone is instrumental in this inclusion, as it has become a gateway to the digital economy in many areas where internet penetration was previously lacking.
On Tuesday evening, the group arrived in San Jose, CA to gain regional perspective of e-commerce and the digital economy in the heart of Silicon Valley. Over the course of three days the group met with representatives from the Joint Venture Silicon Valley, San Jose State University, Tech Museum of Innovation, Stanford University, eBay, a California State Assemblymember, the Bay Area Council Economic Institute, and Uber. An initial theme of the discussion in California was identifying the factors that have made Silicon Valley the most innovative region in the world. Several key components emerged, such as: a result-oriented meritocracy, a culture which rewards risk and tolerates failure, strong capital and labor markets, a mobile and fluid workforce, favorable government policies, strong ties between universities and industry, and a high quality of life.
As a result of these factors, Silicon Valley has become an area of consistent innovation in a fast-paced environment where individuals are judged not only by their success, but by their willingness to risk failure, which is subsequently rewarded by an extensive flow of venture capital. This culture is not unique to Silicon Valley, but has set it apart from many other areas around the world. For many of our participants, this discussion gave them the opportunity to evaluate the state of innovation in their countries, and find commonalities or differences in their home culture of innovation.
In accordance with these governing principles, Silicon Valley places an emphasis on innovation not just for today’s leaders, but for tomorrow’s as well. A visit to the Tech Museum of Innovation in San Jose demonstrated how Silicon Valley is developing the next generation of innovators. Founded in 1990, The Tech receives half a million visitors per year, and over 30,000 children benefit from their extensive educational programs. With exhibits focused on basic robotics, preliminary coding, cybersecurity, and more, The Tech’s goal is not to predict and hone the skills that kids will need in 20 years, but to develop a generation of problem solvers that will be able to adapt to the challenges of the future. As a result, many of The Tech’s displays are interactive, and utilize technology they have obtained through partnerships with notable Silicon Valley firms, a model of public-private partnership that could have success outside of the region as well. The meeting at The Tech was therefore extremely valuable for many participants, as it identified potential ways to develop a similarly-ingrained innovation culture in their home countries.
At the end of the week, the delegation proposed recommendations for ways to better access and utilize the digital economy worldwide, drawing on the themes of discussion with the experts in Washington, DC and San Jose, as well as their experiences in their own countries. The intentionality of policy making was a key issue, in that technology should be employed to solve a specific problem or need, and not treated as an end unto itself. In addition, certain structural factors need to be in place before e-commerce can thrive in an area, such as internet penetration, payment platforms, and most importantly, trust that government and institutions that will successfully execute the process. The importance of proper alliances is also an issue in many countries, as it takes collaboration and partnerships (public/private entities, large corporations/SMEs, technology/traditional means, etc.) to smooth societal ruptures and clear a path for innovation, to the benefit of all involved.
Courtney Flynn, Program Associate, Forum on the World Economic Order, Friedrich Naumann Foundation for Freedom.