Knowledge-based economy (KBE): an investigation of theoretical frameworks and measurement techniques in the South East Asian region

Knowledge-based economy (KBE): an investigation of theoretical frameworks and measurement techniques in the South East Asian region

Recent times have seen knowledge take on increasing importance as one of the most important drivers of economic growth. The difference between a knowledge-based economy (KBE) and a resource-based one is that with the former, the main feature is the ability of individuals and firms to generate innovation. Other forms of competition, such as through pricing strategies and access to resources, become secondary. Generally speaking, knowledge is information combined with technology that dramatically increases output. Organisations such as the Organization for Economic Cooperation and Development (OECD), Asia Pacific Economic Cooperation (APEC), Australian Bureau of Statistics (ABS) and the World Bank Institute (WBI) have developed different KBE frameworks through which to indicate the extent of individual countries’ knowledge base and to implicitly guide policy. However, these frameworks have little in the way of theoretical underpinnings, and applying them universally across all countries in different regions, at different stages of development and with different institutional, social and economic characteristics may be misleading and result in inappropriate policy responses. This thesis proposes a framework which clearly distinguishes input-output indicators of a knowledge-based economy under four important dimensions: acquisition, production, distribution and utilisation. Indeed, this study attempts to adapt measure and investigate them using a practical policy oriented approach for selected Association of South East Asian (ASEAN) and emerging economies which are endeavouring to transform from a resource-based to a knowledge-based economy. The results of this study indicate that theoretically the knowledge-based economy concept is not a new concept and has in fact been present in the literature since the industrial revolution. However, the extent of KBE in cross-country studies, measurement techniques and innovation system studies is very recent. This research demonstrates the concept of the national and regional innovation system, and how to apply recent non-parametric techniques like order-m, order-alpha to rank the best practice countries in this field. Most of the cases, including Singapore, South Korea and Philippines come as frontier countries in both scale and pure technical efficiency of non-parametric analysis. We believe an important contribution can be made to the literature, whether it is the application of Data Envelopment Analysis, Malmquist productivity analysis, the introduction of most productive scale size and peer countries, order-m, order-alpha, TOBIT model and finally the bootstrapping technique in this KBE innovation study.