December 8, 2022

IN his first State of the Nation Address (SONA), President Ferdinand R. Marcos, Jr. spoke of the need for a digital transformation in the country. He instructed the Department of Information and Communications Technology (DICT) to identify plus utilize digital innovations to improve governance, specifically by deploying electronic connectivity through the implementation of the National Broadband Plan and connecting the particular remote areas of the nation with the “Broad Band ng Masa” project. In addition , he also pushed for the completion of the National Identification (ID) card system. Viewing the transformative power associated with digitalization, this individual looked forward to technological innovation in all sectors as it creates new wealth-producing opportunities that are accessible in order to everyone.  

Indeed, several reasons exist for embracing digitalization as a means for social transformation. For one, given this technology, face-to-face transactions in the service sector will no longer be required, hence allowing for the possibility of scale economies, and enhancing trade inside services. Moreover, with digitalization, the distinctions between services and industry can be blurred if service activities are used as inputs for industry, thus lowering the particular costs of doing business. Given these well-known advantages, the push with regard to digitalization is nothing more than a motherhood statement.

However, the particular speech ignored a key aspect of this particular policy, which is the potential to commodify labor plus, hence, create a series of social problems. If labor is only seen as an input associated with production, instead of a measure of human dignity, increasing digitalization, where individuals are viewed merely while ID numbers, can bring about some sort of devaluation of the individual. As Karl Polanyi, the well-regarded labor sociologist, has indicated, labor is not a “fictitious product” that results from market transactions, and treating work as such can result in the destruction from the worker’s essential character. With their power to set wages, employers can view labor as a mere factor of production rather than as a human quality, hence leading to conditions which are harmful to the very people who embody that will labor.

Polanyi suggested two ways to solve this problem of (dis)embeddedness or commodification. The first is the hard Polanyi approach, which calls regarding labor market reforms. Such government-initiated changes aim to reverse the commodification effect plus reinstate the particular competitive discipline of the labour market, a process termed as “re-commodification. ” This implies the incorporation into the employment agreements associated with various institutional interventions—particularly firm internal problems, social protection, and trade unionization—which reduce the market power of companies and enhance the rights from the workers.

The second is the soft Polanyi approach, which will be more methodological than theoretical. This pertains to societal embeddedness in ways that will influence the behavior of workers and employers within the acceptable institutional, social, plus cultural context. Importance is usually given to community norms and institutions, and how the lead firm’s origin and heritage may operate a lot more responsively. For instance, in a recent study of online labor platforms, the way American computer game artists, designers plus programmers are embedded within occupational communities are deemed necessary inside bringing interpersonal values to a particular transaction. Such work is important in highlighting the social dimension associated with embeddedness and in rectifying over-reaching company behavior through community-driven movements.

The point is that digital technology will not really be eliminating any existing market energy simply via adoption. Because of information asymmetry, digitalization will only reinforce this power. To enhance social welfare, digitalization should be accompanied simply by laws or community norms that ensure fairness plus security intended for all parties using such technology. Indeed, the government must first define the particular rights of the individuals.

In short, digital transformation is a complex subject with significant effects on society. As the country engages in this particular technology, economic and social structures are usually invariably modified. The central issues are not about technological adoption but the underlying circumstances that will direct this technologies towards greater social well being. Through both government intervention and community participation, digitalization can be a force for structural transformation along with equity. Considering the current recovery process, seldom are usually we given a chance to take on this challenge.

The SONA was comprehensive in the particular way that will it’s been cast and written. However , it could also be fundamentally flawed because of its shallowness. The particular SONA should prioritize a few key goals, analyze these thoroughly, and attempt to work out an effective plus more detailed plan in order to achieve them. For instance, we are almost all aware of how the digital economy, particularly the social media and the election processes, influenced the results associated with the just concluded presidential elections. Chief executive Marcos, Junior. could have used the SONA to highlight legally and socially the possible ways digitalization can eliminate disinformation to prevent political election abuses plus uncertainty from happening within the future.

Dr. Leonardo A. Lanzona, Jr. is a Professor of Economics at the Ateneo de Manila University.

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