Lessons for India: How Alibaba uses tech to give employment to unskilled villagers

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January 28, 2019 7:00 PM

Alibaba -- the Chinese e-commerce giant -- helps people learn relevant job skills at work so that even those who don't possess formal education could be employed.

Alibaba’s Taobao village model has opened avenues for China’s villagers, who are now earning more than their non-e-commerce peers, despite them being less educated

Not everyone is fortunate to get a higher education, and in a competitive world, education has become pivotal in getting a good job. But, Alibaba’s Taobao village model has opened avenues for China’s villagers, who are now earning more than their non-e-commerce peers, despite them being less educated.

Alibaba — the Chinese e-commerce giant — helps people learn relevant job skills at work so that even those who don’t possess formal education could be employed. All these findings are part of the report presented by Luohan Academy at the World Economic Forum 2019, Davos, which said that digital technology can help spur economic growth.

“Digital technology is making it easier for consumers to start businesses, reach consumers, and access financing,” the report said. Chen Long, the academy’s director, said that digital technologies will make economic opportunities more accessible and sustainable to all. “Widespread adoption and application of digital technology is no longer dependent on the level of income and economic development,” the report said.

What is Alibaba’s Taobao village model?

The idea is to benefit more people via the digital wave. For that, it is important to lower the skill threshold required to operate digital platforms. The report exemplified a typical Chinese Taobao village where households learn the skills on the job and manage to earn more than “double the income of non-e-tailer households at every education level,” the report said.
The report also said that “the benefits of new market access and opportunities are more pronounced in less developed countries.” This may become of immediate interest in the Indian context as the nation faces public outcry over fewer job opportunities.

Michael Spence, 2001 Nobel Prize Laureate in Economics and professor at New York University, said in the report: “In conjunction with experience in other developing countries, there is a very convincing case that digitally-enabled, platform-based ecosystems are a new and powerful growth engine.”

Taobao villages are essentially clusters of rural online entrepreneurs who are brought together by Alibaba’s venture which gives them a platform to operate. Today, Taobao is the world’s eighth most visited site.

It said that the current digital revolution can induce inclusive growth which may even outshine the previous technological revolutions. The report also suggests how lessons from China can be employed in developing economies. Digital technology should be made accessible to the public, it added.

 

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