Google's Head of Global Entrepreneurship, Mary Grove, interprets what the latest research really tells us about the internet's contribution to economic growth.

Written by
Mary Grove
October 2012

Last year, I visited Kabul and Herat. I was curious how people in a country with roughly four percent internet penetration and limited mobile data access interacted with Google search and products. Since radio is a popular form of mass communication in Afghanistan, it turns out that people call in to a local radio show called "€˜Percipal"€™ ("€˜Seek and Search"€™) and ask their query to the host. The host, who has internet access, does a Google search and then reads the answer on air. The message I brought back to the US? Constraint breeds creativity; people are ever entrepreneurial in finding ways to connect with one another to access information.

More than ever, entrepreneurs around the world are leveraging technology and the internet to connect, create, and transform their communities and the world. Every day, people improve the efficiency of their businesses, find like-minded neighbors to improve their towns, and distribute their band'€™s latest single online.

If necessity is the mother of invention, incentive is the father—and there are many ingredients that go into creating the right incentive structures for entrepreneurs to thrive. Among them are access to capital, a talent pool, and a network of mentors who have succeeded and failed, not to mention the commitment of legislators and leaders to promote a free and open web. In the US, where the JOBS Act makes provisions for crowdfunding, we'€™ve seen sites like Indiegogo and Kickstarter use the web as a democratizing platform to surface good ideas and enable entrepreneurs to finance them, leading to more opportunity and job creation.

The internet has created more than 3.6 million net jobs in the US alone, while driving more of the economy than agriculture and construction combined. A recent McKinsey report revealed that in developed countries, the internet has contributed an average of 21 percent GDP growth between 2004 and 2009. On average, the internet contributes 3.4 percent to GDP in the G8 nations, plus Brazil, China, India, South Korea, and Sweden—an amount the size of Spain or Canada in terms of GDP, and growing at a faster rate than that of Brazil.

The internet has created more than 3.6 million net jobs in the US alone, while driving more of the economy than agriculture and construction combined.

In fast-growing and aspiring countries that are poised to contribute, like Morocco, Turkey, and Vietnam, the internet contributes an average of 1.9 percent of GDP already—some $366 billion in 2010. The implication is clear: A free and open web leads to more economic development and opportunity across the globe.

The internet also delivers you an audience that is both local and truly global. Consider Startup Weekend, an organization that runs 54-hour weekend events in over 400 cities across some 70 countries. (Google will be Startup Weekend'€™s "€˜galactic sponsor"€™ for the next two years.) A few months ago, I met the founders of AfterShip, winner of "€˜Global Startup Battle,"€™ a friendly face-off between the 48 winning teams from Startup Weekend events that took place in November 2011.

The four founders of AfterShip met for the first time at Startup Weekend Hong Kong. They formed a team to launch a product that weekend, went on to win the global battle, and released their parcel tracking service to the world a few months later. We'€™ve worked with thousands of similar entrepreneurs across our Google for Entrepreneurs programs, from Campus London to Women Entrepreneurs on the Web, all of whom are creating the next generation of successful digital ventures.

The web also empowers communities to create extraordinary value and, in some cases, to literally put themselves on the map. During our visit to Afghanistan, we saw that no comprehensive digital maps existed. A few months later, the young entrepreneurs we met in Herat used Google Map Maker, a tool that allows people to map their communities in Google Maps in over 188 countries around the world, to map 11 regions in Afghanistan, which are live on Google Maps today.

The possibility of having one'€™s city (or street or business) put on the map exists today thanks to the power of the internet and the communities it enables. Similarly, in Pakistan, a team of local community volunteers mapped all of Lahore in less than 24 hours. The Great Trigonometric Survey of India took 60 years—with Map Maker, you can do it in days.

But we must no€™t assume that the transformational nature of the internet is an inevitable consequence of connecting together a whole bunch of servers and computers. Rather, its totally novel, very-light-touch, community-driven model has enabled entrepreneurs, researchers, artists, and all of us to try things out, iterate quickly and cheaply, and grow exponentially.