Knowledge Assets in the Global Economy: Assessment of National Intellectual Capital Journal of Global Information Management
July-Sep, 2000, 8(3), 5-15.
“Our government is filled with knowledge...We have 316 years' worth of documents and data and thousands of employees with long years of practical experience. If we can take that knowledge, and place it into the hands of any person who needs it, whenever they need it, I can deliver services more quickly, more accurately and more consistently.” From “Knowledge Management: New Wisdom or Passing Fad?” in Government Technology, June 99Abstract This article has the following objectives: developing the need for assessing knowledge capital at the national economic level; review of a national case study of how intellectual capital assessment was done in case of one nation state; suggesting implications of use of such assessment methods and needed areas of advancement; and highlighting caveats in existing assessment methods that underscore the directions for future research. With increasing emphasis on aligning national information resource planning, design and implementation with growth and performance needs of business or nation, better understanding of new valuation and assessment techniques is necessary for information resource management policymakers, practitioners and researchers. Keywords: National Intellectual Capital, Information Resource Management, Knowledge Capital, Intangible Assets, Structural Capital, Human Capital Introduction
Emergence of the service society after the last world war brought increased realization of role of employees’ knowledge and creativity in adding value to the company. Attempts to capitalize company investments in people on the balance sheet in the 1970s failed because of measurement problems. The subject gathered increased interest more recently in the 1990s, with the rapid emergence of information and communication technologies (ICT). As business processes became increasingly ‘enabled’ by large-scale information systems, information systems designers attempted to capture employees’ implicit and explicit knowledge in “corporate memory” by means of intranets and other similar applications (Malhotra, 2000a, 2000b). It was recognized, that in contrast to the knowledge of individual employees, such corporate memory does form part of a company’s capital. Accordingly, “knowledge” has become a key production factor, however the financial accounts are still dominated by traditional factors of production, including buildings and machinery. Hence, there is an imperative need for developing an understanding of“knowledge capital”, or the so-called intangible assets. The topic is not only pertinent to individual enterprises, but also to national economies that are making a rapid transition to a society based on knowledge work. This article develops the case for assessment of national intellectual capital by drawing upon existing research, practice and a recent study of an Asian nation representative of countries making a transition from ‘developing’ to ‘developed’ status. The issues discussed herein are important for information resource management policymakers, practitioners and researchers for assessing their contributions in terms of new measures of performance. More importantly, as the world economies transition from the world of “atoms” to world of “bits,” they would be expected to plan, devise and implement information and knowledge management systems that provide differential advantage in terms of ‘intellectual capital.’ Knowledge Assets and Intellectual Capital
Traditional assessment of national economic performance has relied upon understanding the GDP in terms of traditional factors of production – land, labor and capital. Knowledge assets may be distinguished from the traditional factors of production – in that they are governed by what has been described as the ‘law of increasing returns’. In contrast to the traditional factors of production...
...Trading over the world has dated back to at least 9,000 years ago. Although it may have gone much further back with the trading of animals and the invention of ships, now-a-days international trading is one of the major parts of the globaleconomy. It is the main reason for the development of this much industrialized world.
Trading happens when countries do not have the resources to satisfy both theirs and the consumers’ needs and wants. Countries produce a surplus by exploiting their scarce domestic resources needed. Goods and services are imported and exported for several reasons. For instance, imports could be cheaper than domestic good or even better quality. They may look more appealing to the producers and consumers eyes or they might be more available. Although, in many countries the main reason they trade is because there are no local alternatives to produce with.
A country may have restrictions because they want to protect its domestic supply so they restrict the imports/exports by imposing tariffs on imports so that they become less desirable as they are more expensive and this creates the consumer demand to switch to domestic production. It could be just to help their own economy and to allow its domestic "infant" industry to grow into full industries. Another reason for restrictions on trade is to maintain its balance of trade even because the country might be spending too much on imports...
1. Measuring the Cost of Living
1) Questions for Review # 2
Questions: Describe the three problems that make the consumer price index an imperfect measure of the cost of living.
Answer: The 1st problem is called substitution bias. Consumers substitute toward goods that have become relatively less expensive. However CPI is based on a fixed basket of goods and it ignores the possibility of consumer substitution. The 2nd problem is the introduction of new goods. This means that consumers have more choices and each dollar is worth more when new products are introduced. Because of the same reason for first one, CPI does not reflect the increase in the value of the dollar. The 3rd problem is unmeasured quality change. Normally BLS adjusts the price of the goods when its quality is change. Despite these efforts, changes in quality remain a problem because quality is so hard to measure.
2) Questions for Review # 5
Questions: Explain the meaning of nominal interest rate and real interest rate. How are they related?
Answer: Nominal interest means rate that it is a measurement of change in dollars amount. The interest rate corrected for inflation is called real interest rate. The relation between these 2 rates is as follows:
Real interest rate = Nominal interest rate – Inflation rate rises over time.
So real interest rate show us how fast our purchasing power rises
3) Problems and Applications # 7
Questions: The New York Times cost $0.15 in 1970 and $2.00 in...
...is the current GlobalEconomy?
Introduction of GlobalEconomy
The globaleconomy has been formulated to many definitions. As a basic one that has been defined as the increasing integration of fragmented national markets for goods and services into a single global market. For instance, in a national market, the materials, labors, whole process of production, selling service and so on that are all within a country. By contraries, in such a global market, companies may from country A, conduct research and development in country B, take orders in country C, and sell wherever there existence demand regardless of the customer’s nationality. (Answers. Com, 2008)
Nowadays, globaleconomy has been promoted by the rapidly growth of globalization, what impulses more international trades and events, enhances countries’ corporation and communication, reduces tariff barriers between nations, accelerates development of technology etc. Once again, “A globaleconomy is one whose strategic core activities, including innovation, finance and corporate management, function on a planetary scale on real time” has been expressed by Carnoy. (Carnoy, 1999)
History of GlobalEconomyGlobaleconomy had started from 1800 when the system of global...
When the inaugural issue of finance & Development appeared in June 1964, the world economy was enjoying its best 10-year growth performance since World War two. The U.S. economy was almost one third of the world output during the 1960s. In the 1964 we had to use typewriters, for background research they had to relied on hardcopies, journals and books. It could have taken several weeks to ship printed issues of the magazine to readers around the world.
Some low-income countries with chronic development problems started growing much faster and eventually became major contributors to global growth. The world economic order went through a tectonic transformation, accompanied by, and in part caused by, groundbreaking advances in science and technology and the rise of globalization. How we communicate has changed the most, as advances in computers and mobile technologies have revolutionized all mediums of communication. In 1965, the first commercially successful minicomputer had an inflation-adjusted price tag of $135,470. It was able to undertake basic computations, such as addition and multiplication.
The economy, meanwhile, turned in an increasingly healthy performance as the 1990s progressed. With the fall of the Soviet Union and Eastern European communism in the late 1980s, trade opportunities expanded greatly. Technological developments...
“China and its impact on GlobalEconomy”
Submitted by: Muhammad Shahir Ejaz
China and its impact on GlobalEconomy
China’s Rise and its current economic outlook:
China’s rise as the world’s second largest economic power started from the Industrial boom brought in by the Communist Government’s realization of the relaxation of trade policies about 30 years ago. The main focus of the government was to bring social stability into the lives of a generally poor nation. Majority of the population were inhabitants of farms and were living below poverty line. The governments focus on building industries has brought the opportunity for individuals to move from their farm lands into cities and improve their individual economic status.
As per IMF’s Feb 2012, report for China’s Economic Outlook, the current economic conditions are stated as follows:
China’s economy is slowing, but remains a bright spot in an unpredictable globaleconomy
* Growth is expected to stay above 8 percent in 2012-13
* Inflation is coming down to more comfortable levels
* The real estate market is deflating
A storm emanating from Europe would hit China hard
* China’s growth rate would drop abruptly if the Euro area experiences a sharp recession
* But China has room for a countervailing fiscal response, and should use that space
* Unlike 2009–10, any stimulus should...
...School of Economics
National Research University, Perm
Knowledge Chain in Rosatom Corporation: strengths and weaknesses (on the base of the book «Rosatom is Sharing Knowledge»)
Executed by the students:
Knowledge Chain in Rosatom Corporation: strengths and weaknesses…………...4
For the past several decades knowledge has become extremely important asset of a company. Nowadays large organizations and even small companies have to address the issues of Knowledge Management in order to increase flexibility and efficiency, reduce lead time and involve people as much as possible. As it was mentioned in 1996 by McKern [1; 13-18], the major forces of change are the following: globalization, higher degrees of complexity, new technologies, increased competition, changing client demands, and changing economic and political structures. So companies are starting to understand that the core and sustainable resource of competitive advantages are their employees. In other words all the knowledge...
...Macroeconomic Stability of HPAE Countries
In the past forty years, specific countries in East Asia have presented a sustained economic growth in comparison to others globally. These eight countries are Japan, Singapore, Hong Kong, South Korea, Taiwan, Indonesia, Malaysia, and Thailand. They are referred to as the high performing Asian economies (HPAEs) because of their miraculous growth in the past several decades (World Bank, 1993). Macroeconomic stability is one of the factors that contribute to their success. According to the World Bank (1993), macroeconomic stability was defined as keeping inflation under control, managing external debt well, and resolving macroeconomic crises quickly. How such stability is manifested in these countries is discussed in this paper. Their focus on education was the driving force of the HPAEs’ success.
Reasons for growth
The fast growth of the above-mentioned countries have been attributed to implemented policies and specific conditions in Asia. According to (Radelet, Sachs and Lee, 1997), there are four main reasons that these countries experienced fast growth compared to other nations in the world. The first is that each of the HPAEs had “substantial potential for catching up.” In the 1960s, they were still having low incomes. However, there was already an emphasis on education, thus they were already producing highly-educated workers. The second is that their “geographical and structural characteristics” were very...
...IMPACT OF GLOBAL CRISIS ON INDIAN ECONOMY
Prof. Vani Dhawan
Guru Nanak Institute of Management Studies
The Indian economy has shown considerable resilience to the global economic crisis by maintaining one of the highest growth rates in the world. The intensity of present economic meltdown is so high that it is being compared with the global economic recession in 1873, Great Depression of 1930’s and East Asian crisis of 1990’s. Global Financial Crisis is among the greatest financial challenges to the world economy which is originated in United States of America. The global economic slowdown is unprecedented in scale and has severe implications on policy formulation among emerging market. Currently India has one of the largest developing countries in the world. Its growth was interrupted by the global financial turbulence that was started in 2008 with the bankruptcy of Lehman Brothers. Industries such as Information Technology, Pharmaceuticals, BPO, ITES, Textiles, Automobile and Banking & Financial Services Sector in India suffered setbacks due to shrinking patronage and demand from western markets. Strong economic growth in the last decade combined with a population of over a billion makes it one of the potentially largest markets in the future. This paper provides an overview of global financial crisis and its...