INTRODUCTION :
Technology is the collections of tools including machinery, modification, arrangements and procedures used by humans. Engineering is the discipline that seeks to study and design new technologies.
MEANING AND DEFINITION :
The word ‘Technology’ derived from the Greek word ‘Techne’ Techne = Art, Skill, Craft Oxford dictionary defines technology as ‘The application of scientific knowledge for practical purpose, especially in industry’.
The Importance of Technology :
Technology refers to the collection of tools that make it easier to use, create, manage and exchange information. In the earlier times, the use of tools by human beings was for the process of discovery and evolution. Tools remained the same for a long time in the earlier part of the history of mankind but it was also the complex human behavior and tools of this era that modern language began as believed by many archaeologists. Technology refers the knowledge and utilization of tools, techniques and systems in order to serve a bigger purpose like solving problems or making life easier and better. Its significance on humans is tremendous because technology helps them adapt to the environment. The development of high technology including computer technology’s Internet and the telephone has helped conquer communication barriers and bridge the gap between people all over the world. While there are advantages to constant evolution of technology, their evolution has also seen the increase of its destructive power as apparent in the creation of weapons of all kinds. In a broader sense, technology affects societies in the development of advanced economies, making life more convenient to more people that have access to such technology. But while it continues to offer better means to man’s day to day living, it also has unwanted results such as pollution, depletion of natural resources to the great disadvantage of the planet. Its influence on society can also be seen in how people use technology and its ethical significance in the society.
Advantages of
technologies and gadgets:
The advantages of new technologies and
gadgets are discussed in the following lines.
1. Higher profit: New technologies can
benefit your business in a number of ways. You can get higher profits as new
technologies increase work efficiency, which in turn, increases productivity.
Moreover, fewer work forces are needed as new technologies can automate the
work thus reducing the costs more.
2. Fast access to information: You can get
quick access to information with the help of computer and internet, two of the
most popular technology and gadget in the present times. The ‘search engines’
on the internet help you find information on any topic that you’re looking for.
3. Increases communication: Gone are those
days when you had to write letters in order to communicate with people staying
far away. Nowadays, you can send e-mails and you get the reply within minutes.
Moreover, you can also take help of ‘chat rooms’ to meet new people as well as
to stay in touch with your old friends.
4. Speed up work: There are so many
gadgets that help to speed up work. Right from household chores to office work,
there are gadgets with the help of which you can increase your work efficiency.
It helps you to do quite a number of things in relatively less time.
Disadvantages
of technologies and gadgets:
The disadvantages of new technologies and
gadgets are discussed below –
1. Online fraud: When you use internet for
online transactions, there is always a possibility of being a victim of online
fraud. As for example, impostors may steal your credit card information and use
them for their own monetary gain.
2. Dependency on gadgets: People are
becoming mechanical as they are getting more and dependent on gadgets.
Nowadays, human beings cannot do a simple work without taking help of a gadget.
3. Integrating new technology: It is often
difficult to take a business related decision about whether to buy the latest
technology or wait for some new invention. Moreover, implementing new
technology in a business can be quite expensive; therefore, you need to decide
whether or not you actually need it. Above all, integrating a new technology in
a business is quite a difficult task in itself.
4. Technology related diseases: Human
beings are becoming addicted to the new technologies and gadgets, especially,
internet and computers. Moreover, young people are getting more and more
addicted to mobile phones. Many scientists believe that radiation from mobile
phones may cause blurring vision, headaches and earaches and may be the reason
of cancer, too.
Therefore, it can be concluded that there
are both advantages and disadvantages of using new technologies and gadgets and
it depends on mankind how they want to use them.
ROLE OF TECHNOLOGY IN ECONOMIC
DEVELOPMENT
1. Agricultural Growth
For a long time old seeds, traditional techniques, and waste & garbage etc. were used in agriculture. So, the
productive quality and quantity was very low. But due to use of modern
techniques of production, there is invention of High Yield Variety (HYV) seeds,
fertilizers, threshers, tractors and harvesters, tube-wells and water pumps,
insecticides and pesticides all this result in growth and development of
agriculture. Growth rate of agriculture sector is 2.0 %.
2. Industrial Development
In the past, life was limited of limited population. In
easy life, the use of industrial goods was very low. But now in modern age, use
of industrial goods is increasing day by day. Rapidly increasing population is
also demanding more industrial goods. In this situation, industrial growth
and development is necessary which is possible due to use of
technology. Growth rate of industrial sector is 4.9 %.
3. Increase in Employment Opportunities
Due to use of technology, better quality and quantity of
various goods can be produced. This will lead to increase in the demand for
labour. Increase in the demand for labour will reduce the unemployment. Rate of
unemployment is 5.5 % that is very high in Pakistan.
4. Increase in Factor’s Productivity
Technology plays very important role in increasing the
productivity of factors of production. Modern technology is helpful to increase
the efficiency of labour, which results in increase in production and standard
of goods. Value of annual productivity of labour in Pakistan is $ 100.
5. Reduction in Poverty
Use of technology is also caused in reduction in poverty.
Use of technology makes it possible to reduce in cost of production that
results in fall in price level. Availability of high standard goods at low
prices increases the real income of the people and increase in the purchasing
power. Technology opens the new economic sector that creates more jobs for
unemployed population. All this results in reduction in poverty. 21.0 %
population is living below poverty line in case of Pakistan.
6. Time Saving
Today, time is considered as a power and life is so busy.
Lengthy and old production process is not affordable now. Technology is helpful
to shorten the lengthy production process, it caused in quick yielding and
rapid return. Due to technology, production quality and quantity can be
improved in minim time period.
7. Cost Minimization
Because of modern technology, the firms are in a position
to reduce the cost of production. By employing technology it is possible to use
the same raw material for more output or same output by using less quantity of
raw material. On the other hand, wastage of large industries can be used in
small industries as a raw material, which caused in reduction in cost of
production.
8. Increase in Marginal Efficiency of Capital (MEC)
Marginal efficiency of capital is the rate of return or
profit on capital invested. With the help of technology, a firm can use the
capital effectively. There is less wastage and more increase in the efficiency
of labour that results in increase in the marginal efficiency of capital.
9. Increase in Investment
16.6 % investment of GDP is not desirable for the
economic development in Pakistan. Use of technology caused to increase in
profit margin of the producer. Increase in profit margin will leads to increase
in flow of investment. At least 25 % investment is needed for economic growth
and development.
10. Expansion in Foreign Trade
Use of modern techniques of production leads toward
better quality and quantity of the products. In foreign trade there is stiff
competition among different countries of the world. Use of technology enables a
country to compete with other nations, expansion in foreign trade and to earn
more foreign exchange reserves.
11. Increase in Foreign Exchange
Reserves
Foreign exchange reserves of poor nations like Pakistan
are very short. Our imports are higher than our export that causes scarcity of
foreign exchange reserves. Due to technology, it is possible to produce import
substitutions and exportable goods. So, technology will help a country to
increase its foreign exchange reserves. Foreign exchange reserves of Pakistan
are $ 15.0 billion.
12. Best Use of Capital
Capital is an important factor of production. Technology
is useful to use the capital in the best way. Technology can increase in
production and standard of goods in minimum time period. So, the return on
capital will increase due to use of technology. Profit margin of the producer
also increases with the use of technology. Rate of capital formation is only
5%.
PROBLEMS -OR- OBSTACLES IN WAY OF TECHNOLOGY IN
PAKISTAN
1. Deficiency
of Capital
Cost
of advanced technology is very high. Poor countries cannot use the technology
due to deficiency of capital. Domestic savings are 9.9 % of GDP and investment
is 16.6 % of GDP.
2. Illiteracy
Due to illiteracy, our labour is less efficient and less trained. Accordingly, our labour cannot use the modern technology appropriately. In Pakistan, literacy rate is 57 %. On the other hand expenditure on education sector is 2.0 % of GDP.
Due to illiteracy, our labour is less efficient and less trained. Accordingly, our labour cannot use the modern technology appropriately. In Pakistan, literacy rate is 57 %. On the other hand expenditure on education sector is 2.0 % of GDP.
3. Traditionalist
Society
People
are backward in developing countries like Pakistan. They are passing
subsistence life and they do not want to use modern techniques of production.
4. Import
of Technology
Import
of technology itself is a big problem. In developing countries, there is shortage
of foreign exchange to import the technology.
5. Adverse
Balance of Payment
Import
of technology causes more increase in imports of the poor countries. It creates
more gaps between the imports and exports. It results in deficit in balance of
payment. At present, deficit in balance of payment is $ 10.945 billion.
6. Limited
Home Market
The
markets are limited in their size in developing countries like Pakistan, while
the advanced technologies are concerned with the industries of large-scale.
7. Lack
of Natural Resources
In
Pakistan, natural resources are available. But these resources are remained
unused, ill-used and misused. That feels no need for advanced technology.
Natural resources contribute to GDP less than 1 % in Pakistan.
8. Backward
Social Set-up
The
orthodox and backward social set-up is also an obstacle in the way of use of
modern technologies. People are not ready to use modern instruments and
thinking.
9. Lack
of Foreign Exchange Reserves
Foreign
exchange reserves are necessary to import the modern technology but Pakistan
has shortage of foreign exchanges reserves. Foreign exchange reserves of
Pakistan are $ 15.0 billion.
10. Backward Economic System
Most
of the developing countries are using the backward economic systems, which are
also a hurdle in way of economic development. Implementation of Islamic
economic system is required for economic growth and development.
11. Monopoly of Developed Countries
Advanced
technology is under the influence of advanced countries. They charge higher
prices while transferring technology to poor countries. Sometimes, advanced
nations transfer backward and out-dated technology to poor nations.
12. Lack of Infrastructure
Technology without infrastructure in
developing countries is impossible. Transports and communications are not
available in fully advanced form in Pakistan. There is shortage of sanitation and health facilities. Supply of electricity is also less and
irregular.
QUESTION:
If you want to incorporate in production function than how will you measure technology? What will be the key proxy variable?
ANSWER: Production function is a mathematical equation or graph that shows the relationship between physical inputs and physical outputs for a business. The production function for a business typically focuses on the physical and so does not take into account non physical aspects of production like prices.
Production function is an expression of the technological relationship between physical inputs and outputs of a good.
RND= Research and development expenditure. ( % of GDP )
Expenditure for research and development are current and capital expenditure (both public and private) on creative work undertaken systematically to increase knowledge, including knowledge of humanity, culture and society, and the use of knowledge for new applications. R&D covers basic research, applied research, and experimental development.
Relationship between R&D expenditure and Technology:
There is a direct relationship between them, if one increases other also increases.
The most authentic is R&D expenditure while other proxy variables are:
1- Trademarks application
2- Patents
3- Technical cooperation grants
All are used as proxy of technology.
If you want to incorporate in production function than how will you measure technology? What will be the key proxy variable?
ANSWER: Production function is a mathematical equation or graph that shows the relationship between physical inputs and physical outputs for a business. The production function for a business typically focuses on the physical and so does not take into account non physical aspects of production like prices.
Production function is an expression of the technological relationship between physical inputs and outputs of a good.
RND= Research and development expenditure. ( % of GDP )
Expenditure for research and development are current and capital expenditure (both public and private) on creative work undertaken systematically to increase knowledge, including knowledge of humanity, culture and society, and the use of knowledge for new applications. R&D covers basic research, applied research, and experimental development.
Relationship between R&D expenditure and Technology:
There is a direct relationship between them, if one increases other also increases.
The most authentic is R&D expenditure while other proxy variables are:
1- Trademarks application
2- Patents
3- Technical cooperation grants
All are used as proxy of technology.
Conclusion:
Now,
in any production process, technology is as important as factors of production.
By employing the modern technology, economic growth and economic development is
possible. If a country uses backward methods of productions it will remains
backward forever.
References:
http://www.slideshare.net/
Article by Rodney Gordon
data.worldbank.org
link.springer.com
www.theglobaleconomy.com
link.springer.com
www.theglobaleconomy.com
