Introduction

Knowledge-Based Economy
Dr:Lamees ELAraby
Introduction
In the past decade or so, much research has been conducted on productivity-led
economic growth and its determinants. A major reason is the widespread belief
that economic growth due to rapid factor accumulation is subject to diminishing
returns, and hence is not sustainable.

Recently, there has been a growing interest in the contribution of knowledge to

total factor productivity growth, and consequently to sustainable long-term
economic development.

But firstly there is different concepts should be discussed

Data, information, and knowledge are terms that are often used
interchangeably, but they have distinct meanings, especially in the context of
information systems and technology. Here are the key differences:

Data
Data refers to raw, unorganized facts or figures that are collected and stored. It
can be in the form of numbers, text, images, or any other type of input.
Data, by itself, lacks context and meaning.
It is the most basic form of representation and requires further processing to
become useful.

Here are a few examples of data:

• A spreadsheet containing sales figures
• A database with customer information
• Temperature readings from a weather station
• GPS coordinates from a mobile device
We can see data in two distinct ways, Categorical and Numerical:
Categorical data are values or observations that can be sorted into groups or
categories. There are two types of categorical values, nominal and ordinal. A
nominal variable has no intrinsic ordering to its categories. For example, housing
is a categorical variable with two categories (own and rent). An ordinal variable
has an established ordering. For example, age as a variable with three orderly
categories (young, adult, and elder).
Numerical data are values or observations that can be measured. There are two
kinds of numerical values, discrete and continuous. Discrete data are values or
observations can be counted and are distinct and separate, for example, the
number of lines in a code. Continuous data are values or observations that may
take on any value within a finite or infinite interval, for example, an economic
time series like historic gold prices.

Information
Information is the processed and organized form of data.
It is data that has been analyzed, structured, and given context.
Information provides meaning and can be used to answer questions or make
decisions.
It is the result of data being transformed into a more meaningful and useful
state.

Some examples of information include:

• A sales report highlighting top-selling products
• An article summarizing research findings
• A graph showing the correlation between two variables

Knowledge vs. Data vs. Information

Knowledge goes beyond information in that it involves understanding and
expertise.
It is the result of gaining insights, experience, and being able to apply information
in a meaningful way.
Knowledge is the culmination of information and personal understanding,
allowing individuals to make informed judgments and take effective action.

Examples of knowledge include:

• A doctor diagnosing and treating a patient based on their symptoms
 • A chef creating a new recipe by combining different ingredients and
cooking techniques
• A lawyer using legal precedents to argue a case in court
• Customer support utilizing the company processes and procedures to
answer a client question

Data vs. Information: Compare and Contrast

Context Matters:

Data: Typically lacks context. It represents mere facts, like ’10’, ‘blue’, or ‘A’.
Information: Has context and is meaningful.
For instance, “The sky is blue today” is a piece of information derived from
processing the data: ‘sky’ and ‘blue’.

The Role of Value:

Data: On its own, data might not have direct significance or value until processed.
Information: Possesses inherent value because it aids in decision-making,
understanding, or knowledge derivation.

Purpose:
Data: Serves as the foundation or input for deriving information.
Information: Used for making decisions, insights, or forming knowledge.

How they’re represented:

Data: Can be represented as numbers, symbols, or characters.
Information: Usually represented in a form that’s interpretable by humans, such
as reports, images, sounds, or explanations.

Dependency on Other Factors:

Data: Independent.
Information: Derived from data.

Structure of Data and Information:

Data: Often scattered and can be messy until organized.
Information: Structured and organized, making it easier to understand and
interpret.
Consider this example:
A sequence of numbers “100, 150, 200” is just data.
However, if you put it into context: “The sales of a product over the past three
months were 100, 150, and 200 units,” it becomes information because it
provides meaning and context.
In essence, data is the raw material that is processed to produce information,
and this information is used for decision-making, understanding, or deriving
knowledge.

Knowledge management frameworks include:

Recognizing Knowledge Needs: thinking about knowledge assets at your
organization, and the ways they are actually used for your operation.
Identifying Knowledge Resources: finding where your knowledge comes from, for
instance individual skill and experience, project-driven information, procedural
knowledge, internal processes, market research findings, customer feedback, and
community knowledge.
Gathering Disparate Knowledge: deciding on the best KM tools to collect
scattered information, which includes actively asking employees about their
routine processes and including everyone in the knowledge management process.
Storing and Refining Knowledge: how knowledge is held, but also assessing what
knowledge is actually worth keeping.
Examples are centralized knowledge management tools, company wiki,
learning management system (LMS), customer relationship management (CRM)
system, and community forum.
Retrieval and Distribution of Knowledge: how employees or customers can get
the knowledge you’ve gathered. Examples are training programs, messaging apps
(Slack, MS Teams), content management systems (CMS), webinars, intranets,
and supporting software.

Whether we are analyzing data, seeking information, or applying

knowledge, having a clear understanding of what these are helps us
to extract value and meaning from the overwhelming abundance of
information in the digital age.
Types of knowledge
We're all familiar with the word 'knowledge.'
The chances are you've said it and heard it at work or in your personal life in the
last few months.
But did you know that there are many different types of knowledge?
Understanding how, say, 'explicit knowledge' differs from 'tacit knowledge' can go
a long way to helping you better understand the world–especially if your work
involves building a knowledge management strategy or being a knowledge
manager.
In this guide, we'll define the seven core types of knowledge and give you
examples of how each of them shows up in our day-to-day lives.
There are 7 types of knowledge

1. Explicit knowledge
Explicit knowledge is knowledge covering topics that are easy to systematically
document (in writing), and share out at scale: what we think of as structured
information.
When explicit knowledge is well-managed, it can help a company make better
decisions, save time, and maintain an increase in performance.
These types of explicit knowledge are all things that have traditionally been
what has been captured in a knowledge base or as part of a knowledge
management strategy.
It’s formalized documentation that can be used to do a job, make a decision, or
inform an audience.
Explicit knowledge examples
Companies can share explicit knowledge by maintaining well-documented
information in their knowledge base.
Examples of explicit knowledge include things like FAQs, instructions, raw data
and related reports, diagrams, one-sheets, and strategy slide decks.

2. Implicit knowledge
Implicit knowledge is, essentially, learned skills or know-how.
It is gained by taking explicit knowledge and applying it to a specific situation.
If explicit knowledge is a book on the mechanics of flight and a layout diagram of
an airplane cockpit, implicit knowledge is what happens when you apply that
information in order to fly the plane.
Implicit knowledge is gained when you learn the best way to do something. You
can then take that experience and synthesize it with other learned information
in order to solve an entirely new problem.
This type of knowledge has traditionally been excluded from formal knowledge
bases, as it can be difficult to document and capture in a scalable way.
In order to add it to a knowledge base, think of it this way: “What new thing did I
learn, would it be useful to others, and how can I explain it?” Here is an example
of documented implicit knowledge:
Implicit knowledge examples
While implicit knowledge can be more difficult to document, some examples of
implicit knowledge could include an individual’s ability to prioritize tasks or juggle
projects to meet deadlines.

3. Tacit knowledge
Tacit knowledge is intangible information that can be difficult to explain in a
straightforward way, such as things that are often “understood” without
necessarily being said, and are often personal or cultural.
This type of knowledge is informal, learned with experience over time, and
usually applies to a specific situation.
When it can be captured (if it’s not, for instance, a feeling), it should be added to
a knowledge base.
Doing so makes it easy to share expertise gained over time with others who may
need it.
Tacit knowledge examples
Tacit knowledge can be difficult to transfer and usually isn’t able to be stored.
An example of tacit knowledge could be a salesperson’s ability to know the
perfect time to give their pitch during a meeting.
A combination of experience, reading social cues, and other personal factors
must come together to form that unique bit of knowledge.
Since this knowledge is learned with experience over time, companies can help
employees strengthen their tacit knowledge by sharing techniques and tips on
handling certain situations.
• An example of this could be a list of phrases for sales leads to look out for
when dealing with customer complaints.
• The sales lead could better understand how to ‘read’ or rectify a situation
by being prepared with possible conversation outcomes.

4. Declarative knowledge
Declarative knowledge which can be also understood as propositional knowledge,
refers to static information and facts that are specific to a given topic, which can
be easily accessed and retrieved.
It’s a type of knowledge where the individual is consciously aware of their
understanding of the subject matter.
This type of knowledge is typically stored in documentation or databases and
focuses more on the 'who', 'what', 'where', and 'when' behind information and
less on the 'how' or 'why'. When documented, it creates the foundation for
understanding the subject matter and can help companies improve how they
share procedural and explicit knowledge.
Declarative knowledge examples
Some examples of declarative knowledge include an individual's ability to know
what the company goals are for the year.
The individual can also understand how performance will be measured due to
reading the company newsletter where the goals and metrics are shared across
teams.

5. Procedural knowledge
Procedural knowledge focuses on the ‘how’ behind which things operates, and is
demonstrated through one’s ability to do something.
Where declarative knowledge focuses more on the ‘who, what, where, or when’,
procedural knowledge is less articulated and shown through action or
documented through manuals.
Procedural knowledge examples
Stemming from the root “procedure”, an example of procedural knowledge could
include a standard operating procedure on how to do specific tasks, or use certain
equipment in an organization.
6. A Posteriori knowledge
A posteriori knowledge is a subjective type of knowledge that is gained from
individual experience.
While this type of knowledge isn’t one to be documented on a company’s
knowledge base, it still plays a critical role in the success of teams.
This kind of knowledge gives individuals the ability to know their strengths and
weaknesses that stem from their experiences, and can help companies diversify
their teams skill set.
A Posteriori knowledge example
Due to a posteriori knowledge being derived from individual experiences, some
examples of a posteriori knowledge could include an individual's ability to lead
teams based on their previous roles in management, or the ability to de-escalate
or diffuse tense situations.

7. A Priori knowledge
A priori knowledge is the opposite of posteriori knowledge, and is gained
independent of experience or evidence.
This type of knowledge is often shared through logical reasoning, or one's ability
to think abstractly.
Although a priori knowledge isn’t necessarily documented, it’s often shown in the
form of team’s ability to understand and reason when faced with situations.
A Priori knowledge example
Examples of a priori knowledge could include one’s ability to excel in
mathematics, or logical reasoning due to their natural ability to understand and
interpret information without needing further explanation.
After all, we will discuss the relation between Economic and knowledge
This paper highlights the importance of the use and creation of knowledge for
long-term economic growth.
It discusses the concept of the knowledge economy, which is essentially an
economy where knowledge is the main engine of economic growth.
The paper introduces the knowledge economy framework, which holistically
encompasses elements or pillars such as education and training, innovation and
technological adoption, the information infrastructure, and a conductive
economic incentive and institutional regime.
The framework asserts that sustained investments in these knowledge economy
pillars will lead to the availability of knowledge and its effective use for economic
production.
This would tend to increase the growth rate of total factor productivity, and
consequently result in sustained economic growth.

What is the Knowledge Economy?

The knowledge economy is focused on the essential importance of human
capital in the 21st-century economy.
The rapid expansion of knowledge and the increasing reliance on
computerization, big data analytics, and automation are changing the economy of
the developed world to one that is more dependent on intellectual capital and
skills, and less dependent on the production process.