Manon's Econ Blog

Technology: “The data deluge”

Posted on: February 26, 2010

In the world today, technology is everywhere. It is a great tool especially to store data. It is now impossible to find companies or individuals of developed countries not using technology. But this huge increase in demand has an impact on the economy. Demand keeps increasing more and more, and it is not likely that it is going to stop. Nevertheless, technology has positive externalities that do not seem to be always included in its price. Some of its externalities are the use of the knowledge gained through websites such as Google, or the increase in efficiency for companies that can now store all their data really easily, and so on.

For now, the equilibrium point is PQ, but it would be P*Q* if all society benefit (MSB) was taken into account, and not only the private benefit (MPB).

Although technology has some risks (databases can be stolen…) it has  benefits that are not necessarly taken into account.

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