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The concept of a 'digital divide'-inequality in access to modern information and communication technologies (ICTs) between industrialised and developing countries, and between urban and rural populations-has attracted much attention from policymakers, aid organisations, media and the general public. This paper places discussion of the digital divide in a broader economic context, linking it with the theory of economic growth and technological change. The network effects of diffusion of the Internet are related to the possibility of leap-frogging by latecomers. This is seen as a 'digital opportunity' presented to developing countries by the 'new economy'. This paper discusses the appropriate policy environment for bridging the digital divide, and concludes that the East Asian region has much to gain from the complementarities of its economies, their openness to trade in ICT products, and policy cooperation.

Regional grain flows in China have been expanding with the growth of grain production and the development of grain markets. However, is the current pattern of regional grain flows consistent with regional comparative advantage in grain production in China? This paper examines this question by using a binomial logit model with a discrete dependent variable of provincial net grain flows, and the independent variables of regional comparative advantage indicators and other factors affecting the supply and demand in grain markets. The study reveals that the current pattern of China's regional grain flows is consistent with the regional comparative advantage in grain production, measured by the comparative advantage indicators of Domestic Resource Costs Coefficient (DRCC) and Net Social Profitability (NSP). However, the Efficiency Advantage Indices (EAI), measured by relative grain yield, and the Scale Advantage Indices (SAI), measured by relative grain sown area, are not statistically significant determinants of the observed pattern of regional grain flows in China. This implies that government intervention in grain production is still an obstacle for the Chinese farmers to optimise their grain production mix.