An economy that’s based on knowledge

Ike Señeres

“KNOWLEDGE-BASED ECONOMY” (KBE) was a buzzword in the development circles until it fell out of popular use some years ago. As far as I can remember, the term was also closely identified with “Knowledge Worker”, yet another buzzword at the time. I had completely forgotten about KBE until recently when my friend Manny SD Lopez organized a forum about strategizing on the Internet of Things (IOT) towards KBE. Up until now, I had not imagined that there could be a connection between KBE and IOT until Manny brought it up. Sad to say however, there was very little understanding of KBE as there is also very little understanding of IOT now, and so that would tell you that understanding how the two could work together is very much of an uphill climb.

Without any doubt, we could say that the Philippines does not have a KBE right now, even if we are already starting to get a taste of IOT. Instead of a KBE, what we have now is an import economy because we are simply importing most of the goods that we need, rather than inventing them and producing them internally. Even if we did not embrace the KBE framework before, it is not too late to embrace it now especially so that we now have IOT, but we should only do that if we have an objective outcome, and that should be no other than the production of new patents. Yes, patent production should be the outcome of a KBE, because the success indicator of a KBE, at least in my mind is the creation of new value added (NVA).

Obviously, creating new patents is the only way to create NVA and down the line, NVA ultimately creates new wealth. Since many of our leaders seem to have missed the meaning of that reality, I now feel obliged to state the obvious that new wealth increases prosperity and so therefore it would also reduce poverty. Not that I am complaining so much, but many of our leaders also seem to have missed the difference between poverty alleviation and poverty reduction. As it is supposed to be, the purpose of poverty alleviation is to make the pain of poverty more bearable, but not to remove the source of the pain. In contrast, the purpose of poverty reduction is to remove the cause of the pain, and the cause of the pain is the lack of prosperity.

Sad to say, many of our leaders have also failed to understand the necessity of including the Secretary of Science and Technology in the economic team of the government. The reason for that is very obvious, and that is for the purpose of pushing forward the national goal of creating new patents, in order to create NVA. Not unless we could create NVA, we would always be an import economy. Take the case of Singapore. They are practically a trading economy, but using the power of NVA, they were able to capture a big share of the hard disk market by producing it themselves. Take note that I am not calling Singapore an import economy, because they are exporting perhaps more than what they are importing.

Since we did not understand what KBE was when it was a popular buzzword, we should understand now what IOT is, otherwise the opportunity that it brings would be missed by us again, and we would again miss our chance to get out of poverty towards prosperity. The first thing that we should understand is that IOT is not merely a product. It is more than a product, because it is more like a universe, a universe that has many ecosystems, such as transportation, weather, traffic and defense. The challenge is to create new patents within these ecosystems, so that we could in turn create new products that would create NVA, not only for our own use but also for export purposes.

Of course, I have no doubt that as we create new products or create new companies; it would be possible to combine profit motives and social goals. What that means is that every company can be a social enterprise, inventing not only for money, but also for society. For as long as we believe that all knowledge comes from God, we would understand that a KBE could be no other than a God based economy as well. If we do believe that all knowledge comes from God, it should follow that we should invent for God’s people and that is no other than the broader society itself. Up until now, many inventions have been governed by selfishness and greed. It is about time that inventions should now be governed by the love of God and the love for country.

E-mail: iseneres@yahoo.com