The Knowledge Economy, the Kam Methodology and World Bank Operations

Abstract

This paper highlights the importance of knowledge for long-term economic growth. It presents the concept of the knowledge economy, an economy where knowledge is the main engine of economic growth. The paper also introduces the knowledge economy framework, which asserts that sustained investments in education, innovation, information and communication technologies, and a conducive economic and institutional environment will lead to increases in the use and creation of knowledge in economic production, and consequently result in sustained economic growth. In order to facilitate countries trying to make the transition to the knowledge economy, the Knowledge Assessment Methodology (KAM) was developed. It is designed to provide a basic assessment of countries' readiness for the knowledge economy, and identifies sectors or specific areas where policymakers may need to focus more attention or future investments. The KAM is currently being widely used both internally and externally to the World Bank, and frequently facilitates engagements and policy discussions with government officials from client countries.

Keywords: Knowledge Economy, Knowledge, Economic Growth, Economic Development, Education, Innovation, Technology, Information and Communications Technologies, ICT

JEL Classification: E61, O11, O20, O30, O40