The Competitiveness of Nations: Some Assembled Thoughts
Hillman Chartrand ©
Commissioned by International Cultural Relations Bureau
External Affairs & International Trade Canada, August 1992
In the last decade, an old word has increasingly broken through into the public's consciousness: competitiveness. Competitiveness has, of course, always been with us. But, contemporary usage extends traditional mass market price competition to `working smarter'. Competitiveness applies to all business enterprise, levels of government and nonprofit agencies and workers of the postmodern nation state.
Competitiveness promises prosperity but it is also a game in which some win and some lose. In fact, penetration of competitiveness into the marketplace of ideas has quenched the last flickering embers of the '60s generation's revolution of rising expectations.
The most articulate expression of the concept is found in the World Competitiveness Report. In the 1992 report an important conceptual extension is highlighted, the 'soft side' of competitiveness including things such as attitudes, education, motivation and values reflecting the shift towards a knowledge-based economy.
Competitiveness is linked with creation, transmission and timely application of new knowledge resulting in technological advance. Since the turn of this century, more than two-thirds of growth in national income per worker is attributable to technological advance. But our understanding of its nature is strictly limited. This partially reflects that knowledge traditionally considered for technological advance was restricted to the natural sciences and engineering. Only passing reference is made to 'softer' forms of 'knowing'.
But 'ways of knowing' are like the facets of a gemstone, some twinkle in a certain light while others remain dim or dark to view. Various attempts have been made to contextualize science by aligning it with other facets of knowledge and to thereby break, what some believe to be, Western civilization's Faustian bargain with science.
Contextualization of science is not an 'academic' question. Scientific research today is being restricted by religious 'knowledge' which motivates a powerful social and political movement, e.g. fetal tissue and `abortion' pill research. In fact, after 300 years of the scientific method, ours is a world riddled with superstition, irrational beliefs and ideological fanaticism.
New ways of knowing are, however, moving into focus. For example, 'women's knowledge' is now being institutionalized in the courts, governments, universities and Fortune 500 companies of the West. Feminists maintain that women embody a knowledge distinct from men and that without this feminine knowledge, society will go off course.
Similarly, ecology is a 'holistic' vision firing the public imagination and leading to mass movements and institutional change. An ecologic perspective is holistic in that everything connects to everything else, perhaps even animal liberation. It rejects the reductive, mechanistic approach of the traditional physical sciences and offers instead a relational perspective of environmental systems, e.g. the spotted owl is not an isolated element in a mechanism, but rather, a link in an eternal chain of life. If the link is broken, does the chain fall apart?
But does contextualization of 'hard' scientific knowledge by 'soft' forms create short, or long term impediments to competitiveness?
There is a deepening crisis in the global learning industry. Like other sectors, it is confronting a changing political context in which ecological, ethnic, religious and women's knowledge is being 'legitimized'. In addition, it faces five internal challenges.
First, there is growing questioning of the paramount position granted to the natural sciences and the claim to having their standards of validation apply - no matter the object or the subject of investigation. More generally, there is unrest about the hierarchical nature of politics within the learning industry, e.g. full professors versus associates; the 'right' schools versus the wrong ones; the abstract versus the applied arts and sciences; etc.
Second, 'reality' is increasingly recognized as socially constructed but the central concepts of social life - choice and volition - appear incompatible with those of scientific prediction - laws of motion and probability.
Third, doubts have arisen due to the failure of Western assistance to many `developing' nations suggesting scientific and technical knowledge, from either capitalist or Marxist countries, was insufficient, on its own, to engender the developmental process, e.g. contrast experiences of tribal Africa and Confucian Asia.
Fourth, there is growing tension between vocation and education. At a time when industry and government is calling for more scientific and technical education, declining enrollment in these subject has, at best, bottomed out.
And fifth, there is increasing realization that learning is the ultimate resource but that the hierarchy of knowledge remains unchanged and has failed to accommodate important elements of learning other than literacy and numeracy.
From as early as Galileo, a traditional hierarchy of knowledge distinguished between three levels: primary, secondary and tertiary knowledge. Primary concerns facts or quantities. Secondary or qualities pertains to sensations such as colour, taste, smell and form as well as larger concatenations of these qualities. Tertiary knowledge, or values, are said not to be perceivable from the outside world but are rather innate ideas. Of the three, only primary knowledge is accessible to the scientific method.
Within the learning industry, the irresistible pressure for vocational training in the sciences faces an immovable desire on the part of students for contextual cultural knowledge, i.e education in the sense of rounding. Further, if the scientific method generates only one type of knowledge, i.e. of quantities, what methods should be used for qualities and values?
One way to refresh the traditional model of knowledge is to update it, for example, by using the famous image of the DNA double helix - the spiral ladder of life. The resulting model could be called 'the spiral ladder of competitiveness' (Figure 1). It assumes three uses of knowledge:
- knowledge-for-knowledge sake;
- knowledge for decision and profit; and,
- knowledge for democracy, i.e. an informed electorate is a prerequisite for effective democracy.
The model also assumes there are increasing tolerance of difference, i.e. all three domains of knowledge: the natural things being equal, the more one knows science and engineering (NSE); the of different countries, cultures and humanities and social sciences (HSS); peoples, then the more tolerant of and, the arts. differences one becomes.
NSE is generated by the scientific method characterized by replicability and objective testing. It corresponds to primary knowledge of quantities or facts. It involves a search for objective knowledge to understand and control the physical universe. Progressiveness is vertical, i.e. new knowledge displaces old, and by intolerance of difference, i.e. progress is a process of reducing error, replicability is all.
Both the humanities and the social sciences (HSS) are concerned with understanding the human world. For the humanities, this is essentially sufficient - understanding is all. For the social sciences, however, understanding can be extended to control, i.e. social engineering. HSS corresponds, roughly, with secondary knowledge of qualities. HSS also involves assessment of interactions between natural and human environments, i.e. HSS searches for reconciliation between objective and subjective truth.
HSS knowledge is generated through 'research'. While statistics are used in the social sciences, a modified scientific method must be applied because even basic tenets of the social sciences cannot be quantitatively tested.
Furthermore, unlike NSE, HSS research is relative to time and space, i.e. HSS knowledge is not value-free. Progressiveness of HSS is not vertical. New knowledge does not necessarily displace the old. In fact, HSS progress is a spiral on which ascent is often preceded by descent back to the past, e.g. to the politics of Plato or to Shakespeare's insight into the human condition. Progress in HSS is also characterized by
If natural science is the study of the outer, material world; then art is the study of the inner, subjective world. If the sciences involve the search for objective truth, then the arts involve the search for subjective, value-laden truth. Scientific knowledge depreciates, while knowledge in the arts tends to appreciate through time. If science uses reductive methods, then art generates aesthetic knowledge - a gestalt sense of wholeness or, of rightness.
Metaphorically, the spiral ladder is held together by interactions of the three domains of knowledge. Each plays a role in defining a culture. NSE forms the hard rungs of the ladder permitting reality testing of values and beliefs, e.g. food taboos tend to fade fast in the face of famine. NSE provides a culture with the `how to' change the material world. HSS, on the other hand, tells a culture `what' is worth doing relative to it's value set.
In this way, HSS contextualize or constrains NSE. Similarly, art contextualizes NSE and HSS providing them with emotional valuation of 'rightness' - ugly truths, however, too often hide from public view.
Each culture has its own nonscientific `truths' that limit short-term and long-term competitiveness. Does short-term resistance lead to long run competitive failure? Or, can short term resistance promote long term competitiveness? For example, are short term costs of integrating new knowledge, e.g. women's or ecological knowledge into a culture's institutions, offset by long term benefits flowing from social and political stability?
The three domains of knowledge generate different and distinct types of technology. In simple terms, the physical sciences generate the technology of the 'hand';
the humanities and the social sciences generate the technology of the 'head'; and the arts generate the technology of the 'heart'.
Advances in physical technology result from research in natural science and engineering. It is believed, but not `scientifically' proven, that such research leads
to growth in national wealth.
Art is the source of aesthetic technology. Aesthetic technology is different from technical or functional design. Its impact on consumer behavior involves elegance. If a consumer, in any given culture, does not like the way a product looks, she or he may not even try it. Beyond product design, art plays another crucial role in the economy, advertising - perhaps the most pervasive aspect of the emerging knowledge economy, and one in which global advertising agencies are struggling to gain economies of world scale while confronting the cultural specificity of global markets.
The implication of the `spiral ladder' for the knowledge economy is that creativity, in all three domains o f knowledge, represents the ultimate economic resource. Competitiveness can be achieved through creativity in NSE; it can also be achieved by HSS research leading to liberalization of religious restrictions on business; it can also be achieved by cultivating a distinctive aesthetic and establishing one's culture as a benchmark for global style and taste. At the individual creator level, how much is one Georgio Armani, Agatha Christie or Thomas Edison worth to a community or a nation? Can business, government and the learning industry cultivate an environment in which creative talent (in all domains of knowledge) can come to flower?
But creativity is also required of cultures if they are to be competitive - in the short or long run. Hard competitiveness is often constrained by 'soft' factors such as ethical, historical, linguistic, religious and social values. Together, these constraints invoke a distinct cultural 'mindscape'. Each culture needs to identify its own constraints and maximize within these limits. This requires 'honest' assessment of what is 'true' knowledge and what is cultural myopia. After assessment comes the hardest step: either a creative leap transcending limitations or acceptance of limitations with the hope that they may, perhaps, further long-term competitiveness.
This research note results from a more extensive project concerning the current and future state of world higher education. This note defines 'competitiveness', a factor external to, yet with significant implications for global higher education. Other notes will assess forces internal to higher education and challenges faced as the century ends.
The research project was made possible by a grant from the Academic Relations Division of the International Cultural Relations Bureau of External Affairs & International Trade Canada.
In the last decade, an old word has increasingly broken through into public consciousness: that word is competitiveness. Competitiveness has, of course, always been with us. But, contemporary usage extends traditional mass market price competition to embrace `working smarter' in response to consumer demand for both higher quality and more customized goods and services, globalization and technological advance. Competitiveness applies:
The spread and penetration of competitiveness into popular usage, together with its inherently coercive nature, suggests a new 'criterion' has emerged to assess the performance of the post-modern nation state.
Competitiveness promises profitable and progressive industries, more satisfying jobs, higher salaries and greater tax revenues (collected at lower rates) for social investments such as deficit retirement, education, health, infrastructure and welfare. It also promises to make one's country, community or company 'top dog' in a confusing post-Cold War world.
Competitiveness is very often portrayed as a sports-style 'zero-sum' game. Phrases like 'skating where the puck is going, not where it is' (Wilson 1992) captures its anticipative connotation, revealing perhaps its sports origins. In this game, some win and some lose in an apocalyptic 'us/them' confrontation deciding the destiny of our children, community and country.
Entry of competitiveness into the marketplace of ideas has also effectively quenched the last flickering embers of what sounds increasingly like an ancient incantation of the 1960s: the revolution of rising expectations. A blanket fear of job loss has smothered citizen, consumer arid worker confidence in North America. Fear of downsizing, 'foreign devils', plant obsolescence, privatization, redundancy and technological displacement has chastised a work force that lives in fear that competitiveness means:
Perhaps the most articulate expression of the concept is found in the World Competitiveness Report published annually by the World Economic Forum and Institute for Management Development located in Geneva, Switzerland. The report, over its 12 year history, documents the evolution and extension of the competitiveness concept. In the 1992 report, an important extension of the concept is highlighted.
The past 12 World Competitiveness Reports have consistently shown that excellence in the implementation process is a cornerstone to competitiveness ... by mastering, quickly and accurately, the transformation of ideas and technologies into products ...
[But] the ... Report also stresses the role of the so-called "softer side" of competitiveness... such as motivation, education, attitudes and values... which reflects the shift towards a knowledge-based economy. In the industrialized world today, only 15% of the active population physically touches a product. The other 85% are adding value through the creation, the management and the transformation of information. As a result the human dimension of competitiveness has become a key success factor ... This human dimension ... is characterized by the longer time lag needed to reverse trends. For example the first results of reforming the education system ... will probably only be seen in a generation... (World Economic Forum 1992: 4-6)
To gain fuller appreciation of competitiveness, especially of the 'softer side' competitiveness, the concept will be placed within the context of scientific, political, intellectual and economic knowledge - the building blocs of a 'knowledge-based' economy.
Competitiveness is thus linked with creation, transmission and timely application of new knowledge. Together, creation, transmission as well as application of knowledge result in technological change. Such advance fuels the shadowy engines of post-modern economic growth - the 'knowledge industries' and the "information economy" (Porat 1977).
A strong argument can be made that information capital is as important to the future growth of the American economy as money. Despite this perception, this intellectual capital does not show up in the numbers economists customarily look at or quote about capital formation ... In saying that, I am not arguing that money capital will not continue to be very important; it will.
But I am suggesting that the amazing accumulation of knowledge capital in the last twenty years is very substantial and growing every day but it is uncounted. We have little or no control over the natural resources within our borders, but we do have control over our educational and cultural environment ... If we want better economic forecasting and better policies, clearly some way needs to be found to crank the growth of knowledge into our equations. (Wriston 1985)
is, to be sure, good reason to believe this argument. Since the turn of this
century, more than two-thirds of growth in U.S. national income per worker is
attributable to technological advance (Shapiro 1970: 493).
This lacuna partially reflects that knowledge traditionally considered relevant for technological advance has been restricted to the physical sciences and engineering as well as their handmaidens - literacy and numeracy. Only passing reference is usually made to 'softer' forms of 'knowing' (European Commission 1991).
This is a very old prejudice. Nineteenth and twentieth century Western cultures were based on the assumptions that:
i - science is the only method for attaining true knowledge;
ii - where, in any human endeavour, knowledge is to be sought, science must be used;
iii - because science is the only source of true knowledge, it can provide an all-encompassing view of reality; in other words, it can be raised from a scientific method to a scientific view of the world (Sloane 1991: 24).
Modern science, as a method for understanding nature, is based on the decision to exclude qualities and forces that cannot be directly perceived through the senses or interpreted in terms of physical cause and effect. And there is no doubt that:
... science in the modern era ha(s), as nothing else, affected the whole of human experience. The worlds of culture, of social institutions, of man's relations, and his own self-understanding ... continue to be, decisively reshaped by scientific discovery and its associated technological applications (Sloane 1991: 25).
But 'ways of knowing' are like the facets of a gemstone, some twinkle in a certain light while others remain dim or dark to view. In the first half of this century, John Dewey, among others, attempted to contextualize science by aligning it with other facets of knowledge and experience, i.e. with human culture as a whole. He and others feared that the very power and success of the scientific method held not only a promise but also a threat. Dewey feared that Western civilization had made some kind of Faustian bargain with science. Dewey's attempt:
... showed that modern science has limits set to it, limits within which it has great power and potential usefulness but when modern science is extended beyond these limits, it is misleading and destructive. The proper domain of science, in Dewey's view, is precisely the quantitative and mechanical dimensions of reality.
... Dewey's solution underscores the absolute necessity that instrumental reason as embodied in science must have a context not itself. Without such a context, science runs amok. Equally clear is that this context for quantitative, mechanical instrumental knowing must be qualitative through and through (Sloane 1991:29-30).
If a knowledge economy is emerging, then the 'soft side' of competitiveness needs to be better researched. It may turn out that the return from research in education, motivation and the transformation of value systems may be significantly greater than additional resources poured into increasing expensive and capital intensive natural science research.
Contextualization of science is no longer simply an 'academic' question. It has attained political, intellectual and economic importance. Before investigating its intellectual and economic aspects, three examples of 'real' world contextualization are presented. These examples make evident that contextualization is, among other incarnations, taking the form of mass social movements - movements of an intensity not seen since the antinuclear and antiwar movements of the 1950s and '60s.
First, scientific knowledge itself is being restricted. For example, in the United States, the federal government refuses to fund non-reproduction-related research using human fetal tissue and the so-called 'abortion' pill (The Economist, August 1, 1992: 22). Non-funding is based on a 'right to life' ethic and religious 'knowledge' of when life begins. This motivates a powerful social and political movement.
In fact, three hundred years into the 'age of reason' and opinion polls indicate nearly half of the population believes in UFOs, astrology or the New Age movement. A significant segment of society is fundamentalist Christian and accepts as divine truth a book written in ancient Aramaic and Greek, translated into Latin and from Latin into English, French and other modern languages. While the original may have been divinely inspired, one may fairly question the translators from one language to another, and the transliterators from one alphabet to another.
Many are creationists convinced the world was created ex nihilo 7,000 years ago and actively seek equal time in the classroom with what they consider the secular myth of evolution. The drug epidemic (including alcoholism) infects a population which cannot, or will not, cope with the stresses and strains of modern life except through hedonism and temporarily induced oblivion. This epidemic reflects a failure to institutionalize ecstasy as has been achieved in other civilizations.
The scientific method, applied to the outer, material world, has taken humanity to the moon and beyond. It has given us a collective vision of the unus mundus - one world, one people, one biosphere. But the inner world of feeling, intuition and sensation has not been, and perhaps cannot be, tamed by reason alone. In fact, after 300 years of enlightenment and the scientific method, we live in a world riddled by superstition, irrational beliefs and ideological fanaticism.
Second, women's 'knowledge' is being institutionalized throughout society: in the courts, universities and Fortune 500 companies - women can now walk proud in the corridors of power. Feminist argue that women carry a form of knowledge and experience distinct from men. They contend that without this feminine knowledge, societal guidance mechanisms will go off course causing unnecessary human suffering and wasted effort.
But integration of feminine knowledge is not a universal phenomenon. In non-Western societies, including the Islamic states, sexual segregation is still practiced. Attempts to articulate feminine knowledge tend to be generalizations that will probably be adjusted through time and with research. But one difference appears to be that women seek power from an agenda: something needs to be done, get the power, do it! Men, on the other hand, seek power for position. At the extreme, the feminist argument is:
Until now, womyn have been too busy fighting for equality to speak of superiority. Furthermore, it would have been very bad public relations to do so. Nonetheless, it is said that the world would be a better place if it were run by womyn (the politically correct spelling, as is Herstory).
Third, ecology is a `holistic' vision firing the public imagination and leading to mass movements and institutional change including the recent Rio Earth Summit. Whether rain forests, whales, ozone depletion, global warming or recycling, the 'Green' movement rejects the reductive, mechanistic approach of the traditional physical sciences and offers instead a relational perspective of environmental systems, e.g. the spotted owl is not an isolated element in a mechanism, but rather, a link in an eternal chain of life. If the link is broken, does the chain fall apart?
Within traditional reductive science, Nature is fair game for being taken apart, rearranged, and used up, without regard for its own inwardness, which is denied to it (Sloane 1991: 31). An ecologic perspective is, however, holistic: everything connects to everything else, perhaps even animal liberation.
There is also a connection drawn by some eco-feminists between the subjection of women (Mill 1869) and exploitation of nature by 'Lord Man':
... it is clear that there is a direct link between the domination of women, the persecution of witches, and the ecological destruction that we are now facing. Both are expressions of male violence and contempt towards the Goddess, woman and nature (Metzner 1990:25-6).
The reality is that what is accepted by a culture as 'legitimate' knowledge serves to distinguish it from any other (Weiler 1991). It also defines the scope for achieving short-term competitiveness.
Before turning to intellectual and economic aspects, some questions need to be raised even if, at the moment, they cannot be answered. These include:
These are questions that probably require distinctly different answers in the short and the long term, and in different countries and cultures.
There is a deepening crisis in the global learning industry including: academic colleges and universities; arts academies and professional schools; correspondence and distant learning institutions; polytechnics and technical colleges, private teachers and scholars; public and private schools; and, of course, the teacher-producers and student-consumers of learning products and services.
The learning industry, like other sectors of society, is confronting a rapidly changing political context in which ecological, ethnic, religious and women's knowledge is being 'legitimized'. But, in addition, the learning industry faces five internal challenges.
First, the dis-ease within the industry partially reflects a growing and fundamental questioning of the paramount position granted to the natural sciences in the hierarchy of knowledge, and their previously unquestioned claim to having their standards of validation apply - no matter the object or the subject of investigation (Weiler 1991: 1-2).
More generally, there is unrest about the generally hierarchical nature of politics within the learning industry, e.g. full professors versus associates; the 'right' schools verus the wrong ones; the abstract versus the applied arts and sciences; etc.
Second, questioning reflects that 'reality' is increasingly recognized as socially constructed. In fact, the central concepts of social life - choice and volition - appear incompatible with central concepts of scientific prediction -laws of motion and probability. Prediction, informed by scientific evidence, is possible, but not scientific prediction.
Third, in part, doubts emerge from failure of Western assistance to 'developing' nations, especially in tribal Africa. The experience of postwar history demonstrates that scientific and technical assistance, from either capitalist or Marxist countries, was insufficient, on its own, to engender the developmental process. The cultural location and disposition of 'observer' and 'participant' are essential and, unmistakably, results reflect this reality, e.g. the successful development experience of many 'Confucian' countries of the Asia Pacific Rim (Weiler 1991: 3).
Fourth, there is growing tension between vocational and educational objectives within the learning industry. With respect to the traditional university, this reflects a shifting of the balance between the university's three principal roles:
In part, the growing tension between vocational and educational objectives also reflects that:
... the very nature of modern economic activity has become so massively dependent on up-.to-date knowledge of constantly increasing scope and complexity that the linkage between knowledge ... productivity and profitability has become inescapable ... This is true for the 'hard' sciences and their utility for industrial and other forms of engineering, but also for the knowledge of social and psychological processes and its significance for dealing with labor problems, enhancing productivity, and other forms of 'social engineering' (Weiler 1991:7).
To appreciate current tensions between vocational and educational objectives, it is appropriate to briefly review the evolution of learning institutions in the English-speaking world.
The self-governing university, i.e. independent of the church and state, emerged in the Occident during the twelfth and thirteenth centuries. At the beginning, this social institution was essentially an incorporated association of teachers, as in Paris, or of students, as in Bologna (Schumpeter 1954: 77-78). Oxford University was founded in A.D. 1167, modeled after the University of Paris. To a degree, the universities broke the monopoly of knowledge held by the Church. Accordingly, secular monarchs cultivated and supported these new knowledge institutions to balance the influence of the clergy.
Before long, the associations of scholars and students grouped themselves into faculties, according to the different branches of knowledge. From that time to the present, the university has enjoyed unparalleled social and political autonomy. This autonomy is reflected in tenure, i.e. lifelong appointment based upon peer review or evaluation of the scholar. Tenure permits scholars to pursue intellectual interests free from the threat of dismissal. Research initiated through the individual scholar is called curiosity-based or pure research involving the search for knowledge for knowledge's sake.
The branches of knowledge, or faculties of the university, were essentially based on the classic liberal arts curriculum. Medicine and law were two additions admitted to the medieval university. However, their 'vocational' nature made them somewhat distant from the main academic body of the university.
Similarly, with the exception of music and literature (rhetoric and grammar), art was not part of the ancient or medieval liberal arts curriculum (Cantor 1969: 66-67). The arts were considered 'crafts', i.e. vocational. It was not until the Renaissance that the fine art academy was established as formal center for visual art education completely independent of the university (vom Busch 1985: 3). In theater and dance, there was no formal training in English-speaking universities until the late 19th and early 20th centuries (Robinson 1982: 178179, 191-192). The traditional independent status of the music conservatory is evidence of the separate institutional pattern of learning pursued in art and science.
The beginning of institutionalized science in England started with the Royal Society, established in 1660, which served as a focus for extending the scientific method. Technology, at that time remained, however, craft-based, i.e. controlled and protected by the guilds. Scientific information was largely symbolic of national wealth, i.e. a nation rich enough in gold could demonstrate its wealth through pursuit of scientific knowledge. Similarly, art was considered a symbol, not a source of wealth.
The organization of formal vocational training in England had to await destruction of the craft guild system. Until 1814, the Statute of Artificers regulated vocational training and employment in the craft guild tradition. In that year, responding to deregulation or laissez-faire economic and Benthamite social policies, Parliament abolished the Statute. In short order, the guild system collapsed and the labour market became flooded with unskilled workers. By 1835 the quality of British production, particularly textiles, had declined. to the point that the British Board of Trade appointed a Select Committee to investigate the problem and recommend remedies. It called for the direct marriage of art and manufacturing in order to maintain competitiveness with European rivals. The result was creation of the first school of design in South Kensington in 1836 (Savage 1985).
Then in the mid- to late nineteenth century, vocational training in the English-speaking world became formalized in institutions of higher education called polytechnics. These were created by the founders of the Industrial Revolution in England.
The men responsible for technological innovations . . . during the beginning of the Industrial Revolution were nonconformists who had been excluded from the universities and learned their science indirectly while pursuing their trade. In other words, the coupling between science and technology was very loose and did not rely on the established system of higher education. (Senate Special Committee 1970: 21)
The success of vocational institutions like the Manchester Polytechnic resulted, in many cases, in their absorption or transformation into traditional universities, e.g. the Manchester Polytechnic became the University of Manchester which combined the pure and applied arts and sciences (technology) into the pattern of scientific learning general in the English-speaking world today.
And, of course, in 1870 compulsory primary education was introduced in England. This began the process of diffusing cultural, scientific and experiential knowledge to a wider proportion of the population. It is important to note, however, that the major innovations of the period, e.g. the telephone, telegraph and electric light did not result from university-based research but from the insight of independent inventors, who, like Bell and Edison, created their own research institutes outside the university.
In fact, it was only in the post-World War Two era that the university and university-based research became the dominant source of new technology including chemical, electrical, and nuclear technologies. The war years confirmed that university-based scientific knowledge could play a major role in development of technology. During this period, the concept of technological change evolved into embodied technological change, meaning that specific items of scientific knowledge were embodied in a specific product, for example, the transistor radio. Conventional wisdom now holds that the era of the independent, nonconformist inventor is drawing to an end. However, this convention could be quickly swept away with the appearance of another Bell, Edison or Marconi, i.e. an inventive genius from outside the the ivory tower.
Fifth, unease within the global learning industry reflects, in part, realization that learning is the ultimate resource. This realization gained initial global prominence in 1979 with publication of the second report of the Club of Rome: No Limits to Learning (Botkin, Elmandjra, Malitza, 1979). While this second report did not receive the feverish public reception of its predecessors: Limits to Growth, it nonetheless highlighted the critical importance of learning for global problem-solving, development and integrity:
... we were all proud of a civilization highlighted by unprecedented scientific achievement, wonderful technology and a flood of mass-production which brought in its stride higher standards of life, the conquest of disease, undreamed of travel opportunities and instant audiovisual communications.
But it eventually began to dawn on us that by the indiscriminate adoption of this pattern we were all too often paying exorbitant social or ecological costs for improvements obtained, and were even induced to neglect the virtues and values which are the foundations of a healthy society and at the same time the very salt of the quality of life. Then came the creeping doubt that for all its greatness humanity lacked wisdom (Botkin, Elmandjra, Malitza, 1979).
The authors went on:
The elements through which all learning is mediated include language, tools, values, human relations and images ... The present theory and practice of ... learning tends to elevate language at the expense of all other elements. Tools still receive some attention, but are often considered a second-class of instruments. The others are usually limited to those intrinsic to the status quo, human relations are dismissed as irrelevant, and images are seldom made explicit except in the arts.
While images may be thought to pertain to individuals and to the inner, private life, they also exist at the societal level ... The fact that collective images exist - and that perceptions can be shared - links societal to individual learning (Botkin, Elmandjra, Malitza, 1979)
But the hierarchy of knowledge, within the traditional learning industry, remains unchanged and has failed to accommodate the elements of learning other than literacy and numeracy.
From as early as Galileo, a traditional distinction has made between the primary, secondary and tertiary elements of knowledge or experience. Primary knowledge concerns facts or quantities such as size and extension in space, number, weight or mass, motion and time. These elements of knowledge are regarded as belonging to the 'real' world. They are accessible to observation, experiment, and measure and thus, from the very beginning, modern science was based on a method which by definition deals only with primary knowledge, that is, quantity.
Secondary knowledge or qualities pertains to sensations such as colour, taste, smell and form as well as larger concatenations of these qualities. Qualities are held to exist only in the mind of the observer, i.e. they are produced by the perceiving mind out of physical experience; they do not exist in the objective world. Accordingly, even if qualities are real, they are not accessible to the scientific method (Sloane 1991).
Tertiary knowledge or values are said not to be perceivable from the outside world but are rather innate ideas, divinely implanted or invented by the subjective observer (Griffin 1991). Being purely subjective, values are not accessible to study using the scientific method.
Thus the traditional model of knowledge admits to three distinct types of knowledge. But of the three, only one - quantity - is accessible to the scientific method. The traditional knowledge hierarchy placing scientific or instrumental knowledge on top has significant consequences:
... It encourages the seeing of all human problems as purely scientific and technological problems ... But ... we might say, the definitively human problems ... have no solution, let alone a technical solution. These are issues that lie at the . heart of distinctively human experience - issues involving, for instance self-identity, commitment, loyalty, courage, sacrifice, and so on, and their sources. They have no solution in any instrumentalist sense. The central human issues are probably better thought of as not problems at all but rather more as life-tasks and challenges. They call not so much for explanation and solutions as they do... for understanding (Sloane 1991: 32).
Within the learning industry, the irresistible pressure for vocational training in the sciences faces an immovable desire on the part of students for contextual cultural knowledge, i.e. education in the sense of rounding. Further, if the scientific method generates only one type of knowledge, i.e. of quantities, what methods should be used for qualities and values?
If the traditional scientific model of knowledge is inadequate to the post-modern experience then how can it be extended, modified or replaced to fill the contemporary `knowledge' deficit?
One way to refresh the traditional model of knowledge is to update it, for example, by using the. famous image of the DNA double helix - the spiral ladder of life - the most complex process in the physical universe.
The conceptual dynamism and vigor of the double helix model can be used to generate a working model of the structure and fabric of knowledge - the most complex process in the human world. The model could be used to test implications for soft or cultural competitiveness. This model is the spiral ladder of cultural competitiveness (Exhibit 1).
The model deals with the sources, uses and purposes of knowledge. It assumes that there are three uses of knowledge:
The model also assumes three domains of knowledge corresponding to traditional primary, secondary and tertiary forms, i.e. facts, qualities and values. These are:
NSE consist of three primary disciplines: biology, chemistry and physics. Virtually all other disciplines are permutations and combinations of knowledge derived from these three. Some argue even biology and chemistry can be reduced to physics.
Generation of NSE knowledge is achieved by applying the scientific method characterized by replicability and objective testing. NSE corresponds to traditional primary knowledge of quantities or facts. It Ives the search for objective knowledge to understand and control the physical universe. It is value-free, i.e. it is applicable anywhere and anytime excepting conditions just before and after the `Big Bang'. The search is reductive in nature, i.e. questions are broken down into manageable pieces. It provides the `how to' by which humanity may change and affect the physical universe.
Progressiveness of NSE knowledge is vertical rising up the rungs of a ladder (Washburn 1990). Each step is closer to the truth, i.e. new knowledge displaces the old. It is also characterized by intolerance of difference, i.e. progress is a process of reducing error, replicability is all.
In the model, exceptional treatment must be accorded to the medical sciences which, to varying degrees, create and apply NSE, HSS and, to a lesser extent, artistic knowledge. Many medical sciences function at the borderline between mind and matter; between psyche and physis (Penfield 1975).
HSS consist of two related branches; the humanities and the social sciences. Both are concerned with understanding the human world. For the humanities, this is sufficient. For the social sciences, however, understanding extends to control of the human world, i.e. social engineering. HSS knowledge corresponds, roughly, with secondary knowledge of qualities in the traditional model. HSS also involves assessment of the interaction of the physical and human universes, i.e. HSS searches for reconciliation between objective and subjective truth.
In NSE, three basic disciplines form the bedrock upon which knowledge is built up. In the past, philosophy and sociology pretended to leading roles in the humanities and social sciences, respectively. Today, however, there is no 'queen' or principal discipline in HSS.
Within HSS there are sets of disciplines. A discipline can be considered a generalized theory akin to a language. A theory, i.e. a supposition or system of ideas explaining a phenomenon, is generally couched in certain words and concepts which, when numerous enough, elevate it to the rank of discipline. Hence economics is a language of thought that possesses, like all languages, a vocabulary and rules of syntax. Rules of syntax differ, to some degree, between the disciplines because most pride themselves on methodologies made-to-measure for problems encountered (Valaskakis 1975: 452-3).
The humanities are a complex of disciplines concerned with modes of expression and interpretation of human thought, emotion and experience. The social sciences are a another complex of disciplines concerned with the behaviour and interactions of people, nature and social institutions (OECD 1979: 12). Together the social sciences and humanities share a common interest in the human dimension of reality. Both are concerned with actual and potential goals and values for the individual and human communities.
Generation of HSS knowledge is achieved through 'research'. The results of HSS research take the form of ideas and insights disseminated through scholarly, and then popular publications. Humanities research involves critical study, interpretation or inquiry using generally accepted practices of modes of expression and interpretation of human thought, emotion and experience.
Social science research involves investigation using established rules for performing observation and testing the soundness of conclusions regarding behaviour and interactions of people and social institutions. Unlike the humanities, quantitative methods, i.e. statistics, play a significant role in the social sciences.
Nonetheless, the social sciences must apply a significantly modified scientific method because even basic tenets of the social sciences cannot be quantitatively tested. Quite simply, the technology of social observation and measurement is inadequate.
An example is the theory of revealed preference in economics. Essentially, the theory says behaviour reveals preferences. However, to test this theory with respect to consumer behaviour would require all purchases made through time would be monitored and all changes in family income and general situation were held constant. While the theory appears reasonable, and accepted within economics, it cannot be tested in the real world (Sen 1973: 241-259). Accordingly, testing in HSS tends to be a mixture of scientific method, normative values and `believability'.
Furthermore, unlike NSE, HSS research results are relative to time and space, i.e. HSS knowledge is not value-free (OECD 1979: 18). Value relativity is also reflected in the conservation of existing intellectual capital (Keynes 1936: 383-4). Controversy also exists regarding the relevance of research about one culture conducted by social scientists or humanists of another (Myrdal 1966; Streeten 1974: 12901300).
Progressiveness in HSS is not vertical. New knowledge does not necessary displace old. The insights of Plato and Aristotle concerning the human condition are as relevant today as centuries ago. In fact, progress in HSS is more like a spiral on which ascent is preceded by descent back into the past (Washburn 1990).
Progress in HSS is also characterized by an increasing tolerance of difference. All things being equal, the more one studies the ways of different cultures, genders, races and times, the more tolerant of difference becomes the observer.
The relativity and permeability of knowledge is especially evident in the social sciences which draw upon the concepts of the natural science and the precepts, i.e. normative values, of the arts and humanities. This dependency upon precepts is most evident in ideology, and in the difficulty of reaching consensus concerning the validity of social scientific knowledge and utilization of its insights for social improvement (Mayer 1978).
If natural science is the study of the outer, material world; then art is the study of the inner, subjective world. If the sciences involve the search for objective truth, then the arts involve the search for subjective truth. If science has a 'pure' research or 'knowledge-for-knowledge's-sake' sector that is 'value free', then art has a corresponding 'art-for-art's-sake' sector which is 'value laden'. If science improves our physical comfort and well-being; then art improves our inner well-being including interpersonal and intercultural relationships
If science, excluding the so-called human sciences, breaks down into three basic disciplines biology, chemistry and physics; then art breaks down into four basic media of expression - the literary, media, performing and visual arts. Each uses a distinct medium of expression: the written word, the mechanically recorded sound and image, the live stage and the visual image. Each medium is, in turn, composed of many sub-disciplines and schools based upon differences in style, technique and interpretation. In fact, each artistic medium breaks down into as many varied and subtle branches of expression as any of the physical sciences.
Artistic knowledge, however, is unlike scientific knowledge in a number of ways. First, this difference is exhibited by the differing pattern of education in art and science. There is, in fact, a well recognized gap between graduation from university (high in theory, low in practice) and attainment of professionalism in the arts: art is learned by doing; it is experiential. Thus old craft methods of apprenticeship and master classes survived the Industrial Revolution and remain the most effective method of professional training in the arts. Science, by contrast, is learned by studying and applying a body of systematized knowledge and method.
Second, scientific knowledge tends to depreciate through time, e.g. Greek deductive science has been displaced by modern experimental science. In art, however, knowledge tends to appreciate through time. King Tut, Shakespeare and Bach still speak, still sell. In the media arts, Hollywood film libraries are now multi-million dollar assets. Maintaining classical repertoire, of all forms, provides continuing inspiration to contemporary creators; it establishes standards of excellence against which new work is judged.
This 'religio' or linking back is embodied in the 'heritage arts' which conserve and preserve past and current artistic creation for subsequent generations. However, heritage art also imposes 'the deadening hand of the past'. Contemporary creators must compete not just with domestic and foreign contemporaries, but also with creative spirits of the past. Their works have been tried and tested through time; they enjoy advantages over contemporary creators who must push against the flood tide of history.
We have also forgotten that kosmos, in Greek, means the right placing of the multiple things of the world; not an abstract, impersonal universe out there where no one has gone before. This right placing of things is beauty - the comely coming together of parts. And the means by which a right order is brought into the universe is art. In fact, the equivalent word today for this Greek sense of kosmos is cosmetic, a gift of the Goddess Aphrodite.
The success of the Greeks in attaining aesthetic order is a great living legacy of the ancient world, and to the Greeks, beauty had a moral imperative - kalon kagathon - the beautiful and the good. From this, the poet went on:
Beauty is truth, truth beauty that is all
This sense of wholeness, of rightness is aesthetic knowledge:
That is, the activity of perception or sensation in Greek is aisthesis which means at root "taking in" and "breathing in" - a "gasp", that primary aesthetic response.
What is it to `take in' or breathe in the world? ... it means aspiring and inspiring the literal presentation of things by gasping. The transfiguration of matter occurs through wonder. This aesthetic reaction which precedes intellectual wonder inspires the given beyond itself, letting each thing reveal its particular aspiration within a cosmic arrangement (Hillman 1981: 31-2).
Finally, it is only in art that imagination comes fully into its own. It is in art that imagination is seen to be that grasp of wholeness in all its qualitative relationships, which is the essence of a sense of beauty. It is a way of seeing and feeling things as they compose an integral whole. The whole person also is involved, for imagination is what happens when varied materials of sense quality, emotion, and meaning come together in a union that makes a new birth in the world (Sloane 1991: 38). Or, as Griffin said: "Creativity is that process or activity by which 'the many become one, and are increased by one"' (Griffin 1991: 10).
Metaphorically, the spiral ladder is held together by interactions of the three knowledge sources. Each plays a role in defining a culture. NSE forms the hard rungs of the ladder permitting reality testing of values and beliefs, e.g. food taboos tend to fade fast in the face of famine. NSE provides a culture with the 'how to' change the material world.
HSS, on the other hand, generates knowledge of `what' is worth doing according to it's value set. In this way, HSS contextualize NSE knowledge. Thus while natural science may be able to genetically engineer a 'super-race' this does not mean that society will allow it.
Similarly, art contextualizes NSE and HSS providing them with emotional valuation, in the form of aesthetic knowledge, of a gestalt of wholeness or, of rightness. For example, science says trees regrow when cut down, but an aesthetic response to 'clear cutting' old growth' forest may be so overwhelming that scientific reason is swept aside to avoid 'ugliness'.
While in the West, democratic and egalitarian values may constrain some natural science knowledge, in parts of the Islamic world, faith still segregates the sexes and limits artistic expression, e.g the general prohibition against images of the human body - the temple of God, and the ongoing Iranian contract on the life of Simon Rushdie. But Islam and the West are but two of many competing cultures, e.g. China, Columbia, India, Indonesia, etc.
Each culture has its own nonscientific `truths' that limit short-term and long-term competitiveness. Does short-term resistance lead to long run competitive failure? Or, can short term resistance promote long term competitiveness? For example, are short term costs of integrating new knowledge, e.g. women's or ecological knowledge, offset by long term benefits flowing from social and political stability?
The three forms of knowledge generate different and distinct types of technology. It is generally forgotten that technology is derived from the Greek tekhne meaning art and logos meaning reason, i.e. reasoned art. In simple terms, the physical sciences generate the technology of the 'hand'; the humanities and the social sciences generate the technology of the 'head'; and the arts generate the technology of the `heart'.
To understand the new knowledge economy and the contribution of the differing sources of contemporary knowledge, it is appropriate to begin with basic definitions:
(a) information is discreet bits of knowledge arising either from application of the scientific method and/or through direct human experience, that is to say, experiential knowledge;
(b) knowledge is systematized and retrievable information either in the form of expert opinion, or from a storage medium such as books and computers;
(c) understanding involves the emotional valuation of both individual bits of information and knowledge, e.g. right or wrong, good or bad, useful or useless, etc;
(d) wisdom involves human experience and knowledge combined with the power to apply them critically or practically, i.e. to getting results;
(e) the knowledge economy implies the monetarization of information, i.e information that was once freely available, e.g. university research, is transformed into a potential financial asset; its availability becoming rationed by money, not interest in knowledge for knowledge's sake; and
(f) the currency of exchange in the knowledge economy takes the form of intellectual property - either as legally enforceable property such as copyrights, registered industrial designs, patents and trademarks, or the form of managerial 'know how' and trade secrets.
Intellectual property rights, in fact, provide the legal foundation for the industrial organization of the arts and sciences, i.e. for the total knowledge industry. But legal systems are the product of specific cultures and different cultures recognize different creative rights. As well, in international law, intellectual property conventions require only 'national treatment', i.e. before the courts, the rights of a foreign creator are the same as those of a national. But such conventions do not require either harmonization or standardization.
In French-speaking and most Western European countries, droits d'auteur or author's rights are the equivalent of English common law copyright. The difference in the 'spirit of the law' between copyright and the civil code is significant (Vaver 1987: 82-83)
In this regard, and in addition to problems about agriculture, GATT negotiations concerning a new world trade agreement are floundering due to these differences. The civil code recognizes creators have inherent and inalienable moral rights extending far beyond common law copyright. But such moral rights are available only to individuals, i.e. they do not extend to legal entities such as business corporations. The American position in GATT negotiations is that such civil code rights be extended to corporate copyright holders. Europeans disagree (Morner 1991).
This trade dispute has implications not only for the global knowledge industry but for cultural sovereignty of the post-modern nation state. Two examples will demonstrate.
First, another tradition of creative rights exists among aboriginal or 'Fourth World' peoples. Native or 'collective' copyright is not yet embodied in international statute. But pressure for such rights is growing. Such rights are based on a collectivist concept of creation. To tribal peoples, a song, story or icon does not belong to an individual but to the collective. Rights may be exercised by only one individual in each generation - generally through matrilineal descent. There has even been a proposal placed before the U.S. Congress to convert Amerindian art into 'inalienable communal property' (Suro 1990: Al & 13).
Second, there is a separate Arab Copyright Convention reflecting, to a degree, concepts and creative rights which emerge from the Islamic Shar'ia law, not from common law or civil code traditions concerning creators rights.
Advances in physical technology result from research in the natural sciences and engineering. In the last few generations such research has resulted in creation of the aerospace, biotech, electronics and nuclear industries. It is accepted that this type of technological change leads to growth in national wealth. To the best of the author's knowledge, however, there are no empirical studies demonstrating a causal link between investment in natural science and engineering research and growth in national income. Theoretic and political belief, however, is very strong. Various terms have been used to describe what, at any given moment, is the most efficient physical technology. Leading edge has been used, as has state of the art.
Organizational technology - to motivate workers and managers and then to marry them with financial capital plant and equipment creating a successful business enterprise embodies humanities and the social science knowledge.
Advances and insights generated by HSS influences, among other things, the ability of a company or a country to innovate new products and processes. Two examples demonstrate.
First, the cost of impaired worker and management motivation is estimated at between 20 to 40% of the net national product of the United States (Liebenstein 1966; 1981). The phrase which is the touchstone for organizational success is in search of excellence.
Second, the new democracies of the former Soviet empire are requesting not just capital from the West, but also managerial 'know how' to establish profit-making enterprise and a market economy. The former Soviet Union might have been a world leader in the physical sciences, but its organizational technology was simply inadequate to survive the, post-modern era.
Just as the physical and social sciences are the source of distinct technologies, art is the source of aesthetic technology.
Aesthetic technology is different from technical or functional design. It contributes elegance. Its impact on consumer behavior involves what has been called "the best looking thing that works" (Cwi 1985). If a consumer, in any given culture, does not like the way a product looks, she or he may not even try it.
The fact is that the best looking things that work tend to come from abroad, particularly from Europe. Why? Given capital plant and equipment in North America is as good as that in Europe, the answer is not superior European production technology. In fact, it results from a feedback between skilled consumers and producers resulting in superior design. As noted by Tibor Scitovsky in his path-breaking book, The Joyless Economy:
The North American buyer of European imports benefits from the high standards which careful European shoppers' finicky demand imposes on their producers; he does not have to be a careful shopper himself. In other words, he can be what is known as a free rider, enjoying the benefits of other people's careful shopping without paying his share of the cost, in terms of time and effort, that careful and aggressive shopping involves. That explains why producers find it unprofitable to cater to his demand by trying to out-compete high quality imports, despite the often exorbitant price they fetch. Consumers seem willing to pay a high price, in terms of money, for the reputation of European imports; that is we pay cash to obtain high quality without having to pay for it in terms of careful shopping. (Scitovsky 1976: 178)
When the design advantage of Europe and Japan is combined with the wage advantage of the Third World, then American producers are left with a narrowing mid-range market. This combination of design and wage disadvantages partially explains the apparent deindustrialization of America. Improved productivity through robotics and new technology may lower costs of production, but only improved design will secure for American producers a competitive share of the highly profitable up-scale marketplace.
Beyond product design, art plays another crucial role in the economy, advertising - perhaps the most pervasive aspect of the information economy. It is generally forgotten that within the ecology of capitalist realism, advertising is the lubricant of the market economy. And advertising involves the application of the literary, media, performing and visual arts to sell goods and services. Actors, dancers, singers, musicians, graphic artists, copywriters, and editors are employed to sell everything from fruit to nuts; from cars to computers, from beer to toilet paper.
The manipulation of consumer emotion's through advertising involves, among other things, the reasoned application of art to place products in an positive context (McCraken 1988). In this regard, global advertising agencies are struggling to gain economies of world scale while confronting the cultural specificity of global markets (The Economist May 6, 1989: 64).
This economic role of art has been identified by various research projects around the world:
There is, then, another aspect to culture, namely good taste, good design and creative innovation, that should enable ... economies to compete effectively in the world economy... In this endeavour, higher quality implies an organic relationship between business and engineering, on the one hand, and design and craftsmanship on the other... High quality products, technologies, plants, homes, cities and locales require the long-run presence of creative artists of all kinds. To increase the long-run supply of artists... governments must support... the arts. The long-term return from investment... is real and substantial. In the absence of strong public support of this sector, [a country] will not reap these benefits. Governments at all levels should increase their contribution to their respective arts councils (Royal Commission 1985:115-116).
Both organizational and aesthetic technology are, however, very sensitive to culture, custom and tradition. This may explain why there has been little investigation or appreciation of these technologies by mainstream economics.
The implication of the `spiral ladder' for the knowledge economy is that creativity, in all three domains of knowledge, represents the ultimate economic resource. The importance of creativity as the ultimate economic resource was recently highlighted by Akio Morita, founder and chairman of Sony Corporation at the 1992 World Economic Forum. When asked how Sony dealt with competition, he answered: `What competition? Sony invents and innovates new products; there is no competition".
Competitiveness can be achieved through creativity in NSE; it can also be achieved by HSS research leading to liberalization of historic religious restrictions on business; it can also be achieved by cultivating a distinctive aesthetic and establishing one's culture as a benchmark for global style and taste.
Whether basement inventor, experimental scientist in white lab coat, choreographer, novelist, painter or playwright, it is the creative act that generates the new knowledge that fuels the knowledge economy. At the core of this new economy is the buying and selling of new ideas, inventions, styles and techniques. Around the world, nation states are enhancing incentives for creativity through parallel rights, outside of international conventions, avoiding national treatment of foreigners.
Government may have a responsibility, i.e. Adam Smith identified infrastructure as a responsibility of government, to ensure production of knowledge is treated as the 21st century equivalent of canals, railways, roads and air transport infrastructure, i.e. Adam Smith (1776) identified infrastructure as a responsibility of government (Paquet 1990). In a more philosophic vein, a community, region or nation will eventually run out of raw materials and lose comparative advantages based on traditional sources of wealth generation. Only creativity can conjure up a substitute which turns lead into gold, sand into silicon chips or a first novel into billions in book, movie, T-shirts, toys, records, tapes and other ancillary sales and royalties.
At the individual creator level, how much is one Georgio Armani, Agatha Christie or Thomas Edison worth to a community or a nation? Can business, government and the learning industry cultivate an environment in which creative talent (in all domains of knowledge) can come to flower?
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