Pervasive innovation and technological change, supported by an effective national innovation system (i.e. a network of institutions in the public and private sector whose activities and interactions initiate, import, modify, and diffuse new technologies and practices). Pervasive human resource development , in which education and training are of high standard, widespread and continue “throughout a person’s working life (and even beyond)”. Efficient infrastructure, operating particularly in information and communications technology (ICT), which allows citizens and businesses to readily and affordably access pertinent information from around the world. A business environment (i.e.
the economic and legal policies of government, and the mix of enterprises operating in the economy) supportive of enterprise and innovation. The KBE report distinguished KBEs, on the one hand, from other economies that: [S]imply [have] a thriving “New Economy ” or “information economy” somehow separate from a stagnant ‘old economy’. In a truly knowledge-based economy, all sectors have become knowledge-intensive, not just those usually called “high technology”. Our definition of the New Economy is compatible with the KBE concept. The four dimensions of KBE success are necessary conditions for the New Economy as well.
Indeed they could be used as proxies for whether an economy is successfully creating an environment in which the transformation of activities by individuals, business, governments, and markets will yield maximum sustainable growth. If the business environment is not supportive of innovation, it is fair to say the New Economy will not eventuate. The KBE study permitted APEC economies to analyze themselves in terms of the characteristics that are associated with high sustainable growth. It did not explicitly broach the subject of what fundamental policies precipitate the desired characteristics.
By taking this approach the KBE report facilitated debate on the nature and desirability of “mega- phenomena” such as an environment of innovation, human resource development, infrastructure performance, and facilitating business environment. This Report pushes the analysis deeper than the four characteristics of the KBE , to focus on achieving the New Economy outcome of higher productivity growth and on minimizing the exacerbation of a digital divide which could result from too shy a discussion of policy. At the core of the push of the Report:
First, it is not enough to recognize the importance innovation systems (dimension 1) or infrastructure performance (dimension 3) or business environment (dimension 4). Rather, - 13-