What Is the Meaning of a Knowledge Based Economy

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What is the meaning of a knowledge based economy?

The term “knowledge-based economy” results from a fuller recognition of the role of knowledge and technology in economic growth. Knowledge, as embodied in human beings (as “human capital”) and in technology, has always been central to economic development. In the knowledge-based economy it is the production of ideas, not goods, that is the source of economic growth, and the reason that the new computing and telecommunications technologies are so economically revolutionary in their nature is that they allow ideas to be distributed instantaneously and in a coherent way to anyone, anywhere in the world. Knowledge and learning

The knowledge-based economy is affected by the increasing use of information technologies, it is not synonymous with the information society. The knowledge-based economy is characterised by the need for continuous learning of both codified information and the competencies to use this information. Education will be the centre of the knowledge-based economy, and learning the tool of individual and organisational advancement. The accumulation of tacit knowledge needed to derive maximum benefit from knowledge codified through information technologies can only be done through learning. In the knowledge-based economy “learning-by-doing” is paramount. A fundamental aspect of learning is the transformation of tacit into codified knowledge and the movement back to practice where new kinds of tacit knowledge are developed.

Knowledge networks / transfer

It is not a new idea that knowledge plays an important role in the economy. The knowledge-based economy places great importance on the diffusion and use of information and knowledge as well as its creation. The determinants of success of enterprises, and of national economies as a whole, is ever more reliant upon their effectiveness in gathering and utilising knowledge. The science system plays an important role in transferring and disseminating...
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