Economy

The Next ‘ Big Thing ‘ in World Economy

Big Thing

The timeline of global history begins with the human settlements of early centuries. As humanity discovered domestication of wild animals and plants, it abandoned the hunting and gathering practices, which had a lot of uncertainties attached to them. As agriculture developed, primitive markets based on barter system emerged. With the introduction of a medium for accelerating the exchanges, the economy started to grow at tremendous rates.

Though there were several other allied activities other than agriculture, the production of crops and allied agro-based activities continued to dominate the markets across the world. This trend continued till the early 18th century, when humanity took another big leap: the invention of steam engine. With the power that the machines and the automated production process offered, manufacturing of goods in large volumes became possible. Essentially the story of 18th and 19th centuries are also the story of industrialisation and the emergence of industry driven economies. Factories came up across the world, and this revolution that traces its origins to the England, soon spread to other parts of the world.
The trend of industry dominated markets. National economies continued to be the recurring themes of economic history for the next two centuries till the second World War. By the end of mid-1940s, the world saw a severe crisis both in the domains of economics as well as the society. The whole Europe struggled with the economic crisis and the industrial sector found it almost impossible to drag the war-torn countries out of the economic crisis that they faced.

However, one ‘good thing’ about the World War was that it helped in the growth of technology and innovations. As the countries were fighting the war, they all heavily invested in the development of technology and research to outweigh their opponents. Though most of these researches were meant for the development of defence systems and weaponry, some of them later evolved into innovations that could be used in other domains of social life as well. For example, the Nylon thread invented in 1935 for the military use, was later expanded into the uses in civilian lives as well. It was these technologies that brought the next big shift in the global economy; the emergence of service sector. The service sector started to dominate the global economy from the early 1950s and even today several economies across the world are largely driven by the growth in the service sector, including that of India.

The Next Transition: Knowledge Economy?
Though the economies are still dominated by the service sector, which includes communication transportation and numerous other activities, there is an undercurrent that is there across all economies in the world. We have been seeing this for long but many a times economists and policy makers failed to observe this as an independent phenomenon; the next big shift. It is the emergence of knowledge and an economy based on it that would determine the future economic dynamism of the world. Knowledge economy is thus an economic structure were the creation, processing and dissemination of processed information or the knowledge plays the crucial role in both production and consumption frontiers.
The reason why economics as a domain still fails to accept the emergence of knowledge as the single most important factor of production and ‘factor of consumption’ is due to the fact that knowledge is highly intangible; often it becomes difficult to determine its ownership. For instance, when someone attributes ‘Das Capital’ to Karl Marx, it is essentially a misrepresentation of facts as Das Capital and the Marxist philosophy was not just the mere work of Karl Marx; Marxism was not just the result of the thoughts of Marx but also a reaction to the existing religious institutions.

Now if we look at the religious institutions of those days, which was primarily the Catholic Church, the whole notion of religion and secular life was not the creation of Church but emerged out of the thoughts of Church Fathers like St Augustine of Hippo, Clement of Rome and Ignatius of Antioch. Now again if we look at their writings, their ideas were not ‘original’ in the sense that it was drawn heavily from the early disciples of Christ who in turn wrote their thoughts under the influence of the teachings of Christ. This chain of ideas will continue further as Christ himself was a reaction against the conservative Judaism, a community into which he was born!

The point is that ideas, constructs and knowledge as economic factors are not just mere creations of one single individual, but the results of a decentralised, ongoing process where several individuals take part. However, modern information management regimes like Intellectual Property Rights and WTO frameworks are creating unlawful and inefficient management of knowledge by granting its ownership into the hands of few individuals and corporate entities under the auspices of argument ‘protection of intellectual innovations to incentivise further research.’

Knowledge is not an end within itself, but an ongoing process wherein it expands by adding new blocks; it is intangible and often forms because of the efforts of several individuals and their ideas. Knowledge is unlimited in quantity, yet people denounces this collective nature of knowledge; in fact, the Knowledge Economy is one of the most monopolised economies of all. Indeed, it is certain that the knowledge economy will grow to take up the mantle of economic growth in the near future.

-Contributed by Jiss Palelil

Picture Credits: irishtimes.com/polopoly_fs/1.2360690.1442866010!/image/image.jpg



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