The emergence of the knowledge society, building on the pervasive influence of modern information and communication technologies, is bringing about a fundamental reshaping of the global economy. Its significance goes well beyond the hyping of the Internet. What is underway is a transformation of our economy and society.
Knowledge has always been a factor of production, and a driver of economic and social development. Earlier economies depended, for example, on knowledge about how to farm, how to build and how to manufacture. However, the capacity to manipulate, store and transmit large quantities of information cheaply has increased at a staggering rate over recent years.
The digitisation of information and the associated pervasiveness of the Internet are facilitating a new intensity in the application of knowledge to economic activity, to the extent that it has become the predominant factor in the creation of wealth. As much as 70 to 80 percent of economic growth is now said to be due to new and better knowledge. Information and communication technologies (ICTs) are also facilitating a rapid globalisatio of economic activity.
In an increasingly global economy, where knowledge about how to excel competitively and information about who excels are both more readily available, the effective creation, use and dissemination of knowledge is increasingly the key to success, and thus to sustainable economic and social development that benefits us all. Innovation, which fuels new job creation and economic growth, is quickly becoming the key factor in global competitiveness. Innovation fundamentally means coming up with new ideas about how to do things better or faster.
It is about making a product or offering a service that no one had thought of before. And it is about putting new ideas to work in enterprise and having a skilled work force that can use those new ideas. It is a further feature of the knowledge economy that it increasingly relies on the diffusion and use of information and knowledge, as well as its creation.
The success of enterprises, and of national economies, becomes increasingly dependent on the information infrastructure that is necessary for the gathering and utilisation of knowledge. The importance of broadband telecommunications infrastructure in this context must be recognised as no less significant than the importance of electricity to 20th century industrial development.
Knowledge has become the key resource. Knowledge has value, but so too does knowledge about knowledge. Creating value is about creating new knowledge and capturing its value. The most important property is now intellectual property, not physical property. And it is the hearts and minds of people, rather than traditional labour, that are essential to growth and prosperity. Workers at all levels in the 21st century knowledge society will need to be lifelong learners, adapting continuously to changed opportunities, work practices, business models and forms of economic and social organisation.