Business Dictionary (2010) defines knowledge economy as:
"Economy based on creating, evaluating, and trading knowledge. In a knowledge economy, labour costs become progressively less important and traditional economic concepts such as scarcity resources and economics of scale cease to apply".
World Bank (2008) document states regarding knowledge economy,
"For countries in the vanguard of the world economy, the balance between knowledge and resources has shifted so far towards the former that knowledge has become perhaps the most important factor determining the standard of living - more than land, than tools, than labour. Today's most technically advanced economies are truly knowledge based."
World Bank highlighted the four pillars for knowledge economy are
Economic and Institution management
Education and Skill
Information and Communication Infrastructure
Innovative System i.e. Research
The knowledge economy focused on the production and management of knowledge in the frame of economic constraints, or to a knowledge-based economy. In another meaning, it refers to the use of knowledge technologies to produce economic benefits. The essential difference is that in a knowledge economy, knowledge is a product, in knowledge-based economy, knowledge is a tool. In this way, brain attains a status of resource, ideas and thoughts are considered the products and the money so earned - konwledge money or economy (Wikipedia, 2010).
Drucker (1969) opines that unlike most resources that reduce when used, information and knowledge can be shared, and actually grow through application. Human capital--competencies--are a key component of value in a knowledge-based company. Communication is increasingly being seen as fundamental to knowledge flows. Social structures, cultural context and other factors influencing social relations are therefore of fundamental importance to knowledge economies. (p.263)
Developing countries differ from developed countries not only because they have less wealth and capital but because they have less knowledge. It is often costly to create and that is why much of it is created in industrial countries. United States dominates the world's knowledge economy because 45 out of 50 regions with best knowledge base in the world are situated in the America. (Omar, 2003)
Aims and Objectives
The aim of this paper is to define knowledge economy, its historical background with Islamic perspective and discuss the position of Pakistan in this regard. The issue of education, Information communication technologies (ICTs), libraries, book publishing, brain drain and good governance have been discussed. Valuable recommendations are made in the end of paper for improvement of existing situation.
Islam and Knowledge Economy
Islam promotes learning and encourage to gain more and more knowledge even based upon knowledge. The text of the Quran is replete with verses inviting man to use his intellect, to ponder, to think and to know, for the goal of human life is to discover the Truth.
"He has taught you that which [heretofore] you knew not." (Quran 2:239)
Prophet Muhammad (peace be upon him), said
"Did not leave behind money, but (rather) knowledge, whosoever acquires it benefits a great deal." & "O Allah! I seek Your refuge from such a knowledge which is not beneficial."
The Hadith literature is full of references to the importance of knowledge. Such sayings of the Prophet as "Seek knowledge even in China", "Seek knowledge from the cradle to the grave", and "Verily the men of knowledge are the inheritors of the prophets", have echoed throughout the history and literature of Islam. Over seven hundred verses of Holy Quran urge to develop critical thinking and invite man to contemplate (Baqi, 2000). There are blessing for people who are endowed with knowledge, wisdom and understanding. Allah says;
"It is only such people who are placed in higher grades in the presence of their Lord, and are blessed with special favours." (The Qur'an: 58:11).
Elaborating this verse, Abdullah Yusuf (1957), in his commentary adds
"Although faith makes all people equal in the Kingdom of Allah, but there is leadership, rank degree, joined with greater and less responsibility, and that depends on true knowledge and insight".
Quran strongly recommends the acquisition of knowledge even during the war.
Nor should the believers, all go forth together; if a contingent from every expedition remianed behind, they could devote themselves to studies in religion (The Qur'an: 9: 122).
Impact of Islam on the West
It is a historical fact that without Islamic contributions towards the course of intellectual enlightenment the great western movements of the eighteenth and nineteenth centuries would not have been possible. The Renaissance, the Protestant Reformation, the age of Enlightenment and the Romantic Movement would not have realized their full implications if they had not derived their basic ideas from the Islamic thought and the great works of Muslim thinkers and writers (Hussain, 2007).
The Muslim world was at its peak from the 8th century (750) to the earliest period of the 12th century. This was an advanced civilization had all the ingredients of knowledge economy, which Robert Briffault (1938) describes as;
"brilliant and energetic civilization full of creative energy".
As against this the West was "sunk in barbarism" and low degradation. Robert Briffault (1938) recognizing the impact of Islamic civilization on Europe says:
"It was under the influence of the Arabian and Moorish revival of culture and not in the fifteenth centure that the real Renaissance took place. What we call science arose in Europe as a result of new spirit of inquiry, of new methods of investigation, expeiment,...