Digitalizing at the Expense of Others: The Hidden Costs of Digital Welfare

Abstract

The digital transformation of welfare states is often celebrated for its potential to enhance service efficiency and accessibility. However, this shift carries significant, yet underexplored, social, and economic costs that disproportionately affect both local and global communities. This research seeks to uncover the hidden costs of digitalization in welfare states, illustrating how these changes can exacerbate existing inequalities and foster new forms of exclusion. Focusing primarily on the impact within the welfare states themselves, the analysis reveals how vulnerable populations may experience decreased access to crucial services due to digital barriers. Furthermore, the paper extends the analysis globally, demonstrating how the digitalization processes rely on, and sometimes exploit, international labor and resources, echoing the dynamics of externalization described by Stephan Lessenich in his critique of Western prosperity. By integrating theories of digital exclusion with global inequality frameworks, this research contributes to a more comprehensive understanding of the socio-economic repercussions of digital welfare practices and calls for a critical reevaluation of how these technologies are implemented.