Book Description

Information technology (IT) was key to the superior overall macroeconomic performance of the United States in the 1990s—high productivity, high growth, low inflation, and low unemployment. But IT also played a role in increasing earnings dispersion in the labor market—greatly rewarding workers with high education and skills. This US performance did not happen in a global vacuum. Globalization of US IT firms promoted deeper integration of IT throughout the US economy, which in turn promoted more extensive globalization in other sectors of the US economy and labor market. How will the increasingly globalized IT industry affect US long-term growth, intermediate macro performance, and disparities in the US labor market? What policies are needed to ensure that the United States remains first in innovation, business transformation, and education and skills, which are prerequisites for US economic leadership in the 21st century? This book traces the globalization of the IT industry, its diffusion into the US economy, and the prospects and implications of more extensive technology-enabled globalization of products and services.

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Editorial Reviews

The concluding section is a model of the balanced and astute judgments on international policy issues for which the IIE is justly famous.

Dale W. Jorgenson, Samuel W. Morris University Professor, Harvard University

...essential reading for CEOs, students, and policymakers. This book goes beyond the hype, anecdotes, and political rhetoric by mining the critical data underlying the central phenomena of globalization.

David McCurdy, president and CEO, Electronic Industries Alliance, and former congressman (D-OK)


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Executive Summary


1. Accelerating Globalization: Why Focus on Information Technology?

2. Linkages Between US Firms and Global Markets for IT Products

3. Globalization and IT Prices, Diffusion, and Productivity

4. Information Technology, Outsourcing, and the New International Trade in Services

5. Information Technology and Labor Markets

6. Globalization of Innovation

7. A Look Forward with a Policy Agenda

Appendix A: Methodology and Definitions



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