The government could generate 700,000 jobs by investing £15 billion in digital infrastructure, according to research from the London School of Economics (LSE) and the Information Technology and Innovation Fund.
The investment should be made in the technology around broadband, transport and utilities, the researchers said in their report, ‘The UK’s digital road to recovery’.
They supported government investment in IT but called for more “ambitious and immediate” investment.
The money should be spent as direct investment, and also through tax incentives and regulatory changes that spur increased private sector investment.
Investment in IT would be more effective at stimulating the economy than spending on roads, bridges and other forms of physical infrastructure, the report claimed. It would also reduce traffic congestion and household energy bills.
Robert Atkinson, president of the Information Technology and Innovation Foundation and co-author of the report, said: “Nations that invest in ICT to transform fields like transportation and energy reap substantial long-term economic and social benefits."
He added that "these investments also have a short-term impact by producing the jobs and economic growth the UK needs to get out of the current recession".
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