Speak Your Piece: Digital Parity Will Help Rural Turn the Corner Economically

We need to update our economic models to take into account virtual reality, collaboration platforms, and similar tools that reduce the need for people to be close to be close to each other to create and do their most productive work.

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Roberto Gallardo (Source: Purdue University)

I would like to share a different perspective of what seems to be a growing narrative on a decaying rural America and giving up on it. Not long ago, Eduardo Porter argued this view on his December 14th 2018 piece while Paul Krugman’s did the same on his March 18th 2019 piece.

I disagree.

In my work with rural communities across the country over the past 15 years, there are countless rural leaders that have welcomed me—an immigrant—to help with their efforts to turn their communities around. The problem is that the playing field is far from being level.

Krugman implies in his March 18th 2019 opinion piece that rural areas are all about agriculture and extractive industries. This assumption is wrong. A growing body of research shows that innovative businesses are common in rural areas and the National Governor’s Association argues that the creative sector is a proven economic catalyst for rural.

Obviously rural cannot compare with urban economic dynamism (yet!) and because of this reason, should not be analyzed, and much less, measured to the same expectations. But this should not overlook the fact that some rural areas are thriving thanks to high-speed internet, place making, civic engagement, and an entrepreneurial spirit.

Agglomeration forces, and all the economic benefits that come with them, will continue, or so urban pundits argue. (Agglomeration is an economic concept that says proximity creates benefits that give cities an economic advantage over less densely populated areas.) But will these benefits continue?

Urban housing costs and traffic are starting to counteract these industrial age agglomeration forces. A reversal of these forces could continue to gain steam but there is one major problem, one that urbanites don’t even consider: lack of digital parity.

Digital parity between urban and rural along three dimensions—mindset, connectivity, and skills—is lacking (I have written about this before). The rural-urban digital divide has been well documented on the connectivity side. In addition, digitally skilled workers abound in urban communities while rural communities struggle to retain their youth. And lastly, a digital mindset, one that allows to transition to, plan for, and prosper in the digital age, is also more evident in urban areas.

A message from the Rural Assembly

Question is: Will it help rural areas turn the corner if digital parity, as defined above, were a reality?

You betcha.

Talent exists everywhere. The ecosystem—or playing field—where talent thrives does not. A recent study by C_Tec found that rural small businesses across the country could add $47 billion to the U.S. GDP per year and could create more than 360,000 jobs in the next three years if they could only unlock their digital potential.

I am not naïve in believing that rural communities are not hurting, or that the internet alone is the answer, or that turning them around will happen overnight. After all, the death of distance has been “disproved” before. But, how can you continue to disprove the death of distance today with more sophisticated digital applications than those in place before? Or how, amidst so much digital transformation can the death of distance argument not be revived?

Innovation will change dramatically with the advent of artificial intelligence, mixed reality, and platforms designed entirely around virtual collaboration. Will agglomeration and close physical proximity be as relevant then?

So, let’s get real about 1) updating economic assumptions/models and 2) investing in strategies that will help level the playing field. After all, almost half of Americans would like to live in a small city suburb, town or rural area.

Roberto Gallardo, Ph.D., is assistant director of the Purdue Center for Regional Development. 

Read more responses to Paul Krugman’s New York Times column “Getting Real About Rural America: Nobody knows how to reverse the heartland’s decline” (March 18, 2019).

#krugman2019

A message from the Rural Assembly

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