Essay About Knowledge Economy And Basic Economic Resources Вђ

Knowledge and the Creative Class
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Introduction
World-renowned author Peter Drucker is not only known for his insights on management, but also for advocating the rising importance for a knowledge economy. Drucker once stated that, “The basic economic resources – �the factors of production’, to use the economist’s term, is no longer capital, nor natural resources… nor �labour’. It is and will be knowledge.”1 Knowledge is the driving force of today’s economy. Due to its increasing returns, it ensures that the economy will continuously expand. This is explained by the New Growth Theory, that the marginal product of human capital is constant rather than diminishing. To establish a knowledge-based economy it is essential to form a Creative Class that is comprised of individuals who utilise their intellectual capital and aid in the formation of a creative economy. To foster the rise of the Creative Class, a high-quality education system and lifelong learning need to be developed and maintained. Developing countries today suffer from socio-economic problems and as a result are unable to prioritize the expansion of their education system. This has limited the establishment of a strong knowledge-based economy in those countries and has put them in a disadvantage in globally competitive markets. As the need for creativity in the workforce has become prominent in today’s society, governments need