Three forms of the knowledge economy: learning, creativity and openness.

• Author: Peters, Michael A.

Introduction

It is important to distinguish a number of different strands and readings of the knowledge economy and important to do so because it provides a history of a policy idea and charts its ideological interpretations. (1) The different strands of this discourse are radically diverse and include attempts to theorize not only knowledge economy but also the parallel term 'knowledge society', and also the attempts to relate these terms to wider and broader changes in the nature of capitalism, modernity and the global economy. Early attempts by Friedrich von Hayek (1937, 1945) to define the relations between economics and knowledge were followed by the economic value of knowledge studies of the production and distribution of knowledge in the U.S. by Fritz Machlup (1962). Both of these scholars were associated with the Austrian school of economics. Gary Becker (1964) a prominent member of the Chicago school analyzed human capital with reference to education while Peter Drucker (1969), the management theorist, developed an emphasis on 'knowledge workers' coining the term in 1959 and founding the field of 'knowledge management'. In a different vein, Daniel Bell's (1973) sociology of postindustrialism emphasized the centrality of theoretical knowledge and the new science-based industries and Alain Touraine's (1971) The Post-industrial Society hypothesized students as a new social movement and predicted the 'programmed society'.

In the seventies, eighties and nineties there were various attempts by theorists from different disciplines to theorise aspects of the emerging economy. There is no space to discuss their work here but only to mention examples of the diverse literature. Mark Granovetter (1973) theorized of the role of information in the market based on weak ties and social networks. Marc Porat (1977) defined 'the information society' in a series of publications for the US government and Alvin Toffler (1980), the futurist, talked of knowledge-based production in the 'Third Wave economy'. The French philosopher Jean-Frangois Lyotard (1984) defined The Postmodern Condition as an age marked by the contingency, complexity, dispersal and distribution of knowledge and the Marxist geographer David Harvey (1989) analyzed large-scale shifts from Fordist to flexible accumulation in contemporary capitalism.

James Coleman (1988) analyzed how social capital creates human capital and Pierre Bourdieu (1986) and Robert Putnam (2000) further developed the notion providing distinctive notions of cultural and social capital. The Stanford economist Paul Romer (1990) argued that growth is driven by technological change arising from intentional investment decisions where technology as an input is a nonrival, partially excludable good and the OECD's (1996), basing its work on Romer and endogenous growth theory, provided an influential model of the 'knowledge-based economy'. Meanwhile Joseph Stiglitz (1999) ex-chief economist developed the World Bank's Knowledge for Development and Education for the Knowledge Economy programs based on the notion that knowledge is a global public good. (2)

In the wake of these reports employers called for new workforce skill sets (Partnership for 21st Century Skills, 2008) and public policy applications and developments of the 'knowledge economy' concept began to appear in authoritative policy anthologies at the end of the decade (Hearn & Rooney, 2008).

This demonstrates that since WWII theorists from different perspectives and disciplines have simultaneously tried to analyze and describe certain deep-seated and structurally transformative tendencies in Western capitalism, society and modernity to move to a form of post-industrial economy that focuses on the production and consumption of knowledge and symbolic goods as a higher-order economic activity that encompasses and affects the entire economy and society (Foray, 2000). While they differ on its societal effects and impacts these theorists agree on the epochal nature of this deep economic transformation and the way in which it represents an ongoing automation and technologization of processes of scientific communication, including access, distribution, and dissemination that lie at the heart of knowledge creation.

What this brief potted history reveals is the different stages in the evolution of a discourse with parallel streams in economics and sociology, often contradictory or opposing, different ideological sources, separate conceptual histories and different visions of economy and society. We can no longer simply hold that 'knowledge economy' or 'knowledge society' are neoliberal notions and ignore their descriptive and analytical force. They are complex and openly contested policy descriptions that have emerged to describe the trajectory of the rich liberal capitalist states and now function as a generalized world policy framework that permit local applications and forms of indigenization of associated concepts and policies, depending on location, the geopolitical climate, state actors, and a range of other factors. Rather than discuss the origin and ideological basis of the knowledge economy which I have done elsewhere (see Peters and Besley, 2006) I want to focus on recent developments and applications of the concept that depend upon processes of education and learning directly.

The term 'knowledge economy' is a concept undergoing further conceptual development. In the following sections I have detailed three forms of the knowledge economy: the 'learning economy'; the 'creative economy'; and, the 'open knowledge economy'. Each of these has a special relationship to education and pedagogy and highlights the significance of learning processes within these larger policy frameworks. What this analysis demonstrates is the increasing and dynamic differentiation of the concept and progressive new developments that distinguish and refine elements of the general concept. What also is clear is that the main strands of the analysis of the knowledge economy draw on overlapping literatures in economics, sociology and philosophy, and together share some underlying general concepts concerning economic, social or epistemic shifts that characterize modes of economy and social organization and large-scale global, geopolitical historical periodizations-agricultural-industrial-postindustrial-knowledge 'economy' and 'society'--that map onto more general debates concerning European 'modernity', 'post-modernity' that more recently mention global or historical 'multiple (post)modernities', and a set of broader philosophical debates that employ the terms 'modernism', 'postmodernism', and 'antimodernism'.

The Learning Economy

The concept of the learning economy was first coined and has been championed by Bengt-Ake Lundvall, a Swedish economist from Aalborg University, who uses the term to talk about a new context for European innovation policy. (3) Lundvall (1994, 2003) first used the concept in the mid 1990s in a series of working papers to discuss technological change, innovation and institutional learning directly applying it to the learning society and economy, to universities, and to education more generally in the 2000s, culminating in How Europe's Economies Learn (Lorenz & Lundvall, 2006) that focuses on diversity in European competence building systems, organization, labour markets and corporate governance and the links between education and science-industry. The concept and theory of the learning economy is a refinement of the 'knowledge economy' concept based on the way a set of interlocking forces (ecologies) in information/ knowledge intensities, distributed new social media, and greater computer networking and connectivity have contributed to the heightened significance of human capital formations, mode of social production and an emphasis on learning processes. Lundvall (1996) argues, for instance, that

the growing frequency of so-called paradoxes in economic theory and of unsolved socioeconomic problems reflects that neither economic theory nor policy has been adapted to the fact that we have entered a new phase: the 'Learning Economy'. In the learning economy it is the capacity to learn that increasingly determines the relative position of individuals, firms and national systems and Lundvall claims that the growing polarisation in the OECD-labour markets is explained by the increasing importance of learning and the acceleration in the rate of change. Sustainability of these learning economies tendencies ultimately depends on the distribution of capabilities to learn. The OECD highlights the importance of skills and learning focusing on life-long learning becoming the central element in a high-skills, high-wage jobs strategy. Lundvall distinguishes between information and knowledge; the former is logical, sequential and easily broken down into bits and transmitted by computer whereas the latter is associated with learning that is often a form of know-how and competencies based on tacit knowledge. An information or knowledge economy is quite different from a learning economy that is not tied to formal knowledge institutions and goes beyond formal propositional forms of knowing to the arena of routinized learning based on learning-by-doing or learning-by-using. Such a definition allows us to consider the types of learning associated with the process of working that emphasizes tacit, practical and embodied knowledge generated during the work process. One might also argue in a broader sense that the learning economy focuses on learning processes that are responsible for the production of knowledge.

Lundvall et al (2008) argue that innovation is crucial to economic competitiveness and learning is crucial to innovation. They argue that knowledge is becoming obsolete more rapidly than before and that therefore firms and employees constantly have to learn and acquire new competencies, mostly learnt through experience. Lundvall and his...