Knowledge Economy part 2

The world in the 21st century is characterized by successful relations between science, technology and economic development. The formula of economic growth is defined as the sum of adjustment efforts to technological changes by governments, business, and their people to close the dividing gap between developed and underdeveloped countries. This formula has been used successfully by countries that know how to turn knowledge into a major element in their economy instead of the traditional elements such as low cost labor, physical capital and natural resources. To succeed, there are some pre-conditions that must be met: Good education systems, high percentage of young people with college education, a culture that emphasizes education importance, good incentives for efficient performance and good coordination between the academic system and industry. If underdeveloped countries want to have a chance to succeed in today's highly competitive world, they can follow roadmaps from China, India and S. Korea. In these countries, knowledge economy is conceived by the education and training in technology that generates the knowledge economy (Science and technology – mostly focus on computing, information technology and the Internet). Do not confuse the knowledge economy that generates technologies with the consuming and buying of these technologies. These emerging countries have prospered and created jobs in building and selling technology products. If you only consume these products then you are only in the consuming economy that means you are losing money not making money for the economy. By having a strong education and apply these knowledge (New methods of management use of information technology, qualification of personnel) into areas such as agriculture, business, and industry these countries have experienced significant economic growth and with time all areas of their economy will be saturated with the knowledge and they will emerge from developing to fully developed countries with recognizable benefits.

What the knowledge economy need is workers whose actions reflects performance and if they do not have a specific knowledge, they can find it and as soon as it is acquired, they will know how to use it properly, appropriately, ethically and correctly. Workers do not need to be told what to do as in the traditional way where unskilled labors obey the management. Today knowledge workers need to be educated and directed so they can produce and contribute to the overall goal of the company. It is for this reason that an increasing number of companies in developed countries begin to develop knowledge management rather than people management.

The key factor in the roadmap that brings economic prosperity is good education. If it were not for the introduction of good education, all these changes could never have happened. However, if the education was simply a process of transmitting knowledge from teachers to students then it never achieve the goals of creating a knowledge-based economy. Today education must focuses on the development of skills and abilities that allow everyone to build their own knowledge, to face new situations and resolve new problems by themselves. The greatest mistake is to believe that education is simply the acquisition of knowledge and this is the solution to all problems. Knowledge is nothing if we do not know how to use it properly, appropriately, ethically and correctly. Do not confuse knowledge with competence. Knowledge is what you know and competence is how you apply it. Competence can not be achieved without the corresponding knowledge but knowledge can exist without the competence as people call it “Wishful thinking”. In this case, people talk about knowledge but do not know how to apply it or do not want to use it. The goal of learning is know how to filter and organize available information and distinguish between the data and information that make up the knowledge.

The era of knowledge-based economy has opened up new challenge for the education system. Today society demands that everybody should have access to education throughout their lives. This is not just the traditional education where children go to schools from kindergarten to colleges but throughout their life or lifelong study. Educational systems must respond to these new demands and create the conditions for this kind of education to take place. As technologies changes every year so does education system must adjust or else they will be left behind.

This is why education should not just be a process of transfer knowledge but must focus on the ability to learn how to learn. The education system should broaden the practicability aspect rather than achieve the specialization of knowledge within rigid structures of modeling, theorization with “Book knowledge” and “Rote memorization”. We must educate our young people for their entire life because preparation for life is also preparation for the principles of good living such as ethics, citizenship and preservation of the environment. All of this implies great changes in the structure of educational system which until now has only focus on a certain period in people's lives. The new education of the 21st century should be redesigned to achieve the need for life-long learning.

All changes require new attitudes and mentalities of its citizen. Strengthen the knowledge-based economy by means of better education and training are essential because without these elements, developing countries will continue to exist simply as those with many factories with miserable conditions of work, where incomes will be determined by cheap labor and people will work only on assembling high technology products and thus suffering ever-increasing technological backwardness in relation to the creation and innovation of technology products. Of course, education always come with a price but if you think education is expensive, try ignorant. Without a good education system, no country can prosper to this highly competitive world because if you do not improve, other countries will.


  • Blogs of Prof. John Vu, Carnegie Mellon University

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