The nature and pace of knowledge – and, particularly, technological knowledge – change

The nature and pace of knowledge – and, particularly, technological knowledge – change

The creation and diffusion of productive knowledge have become central to growth and development. Knowledge‖ includes not only technical knowledge (research and development, design, process engineering), but also knowledge of organisation, management and inter-firm and international relationships. Much of this knowledge is tacit. Today, the resources devoted to such knowledge exceed investment in tangible machinery and equipment in many of the world’s most dynamic firms. And the costs of generating new knowledge are rising constantly. The importance of knowledge is not limited to modern or high-tech activities. But it pervades all sectors and industries. They include traditional activities in the primary sector (for instance, vegetable and flower exports), manufacturing (such as textiles, clothing and footwear), and services (such as tourism and banking). As a result, achieving development objectives is, more than ever, a continuous learning process. (technological knowledge)

The sheer pace of technological change, in particular, is unprecedented arid is accelerating. This means that enterprises that want to be competitive internationally reed both the knowledge to use technologies efficiently and to keep pace with developments. Innovators need to invest more in creating new knowledge. But even followers need the capacity – difficult to acquire – to access and use this new knowledge, or in fortuitous circumstances, to identify windows of opportunity for technological caps. The skills required for this are changing concomitantly, as are institutions and their relations with productive enterprises; one development is the closer linking of science with technology-generation in industry. An important result of this new ―technological paradigm‖ is that research-intensive activities are growing more rapidly than others in production and trade. Thus, sustained economic growth calls increasingly not just for the application of new technology to existing activities, but also for a shift of activities up the value-added chain.

The most profound technological changes today emanate from a merger of communications and information processing technologies. While the telegraph, telephone and computer were significant technological achievements; they pale in comparison with emerging technologies based on the interface between microprocessors arid telecommunications. These are generic technologies that affect practically the whole range of economic and even social and cultural activities. Information can now be transmitted across the globe at very low cost. ii) Shrinking economic space and changing competitive conditions

Technical progress in transport and communications has caused economic space to shrink dramatically. Countries now face much more intense and immediate competition than ever before. This leads to a significant restructuring of their comparative advantages and activities. The nature of competition itself is changing, with the rapid introduction of new products, shorter product cycles, flexibility of response to demand. And customer interaction is becoming more important than traditional forms of competition based on lower costs. At the enterprise level, this calls for new management and technical skills and organisational forms. Countries that cart do that – either generally or in niche markets – can move up the value-added ladder. (technological knowledge)



Technological Environment

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