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In the market economy, the focus is on societal development as a factor of buying and selling. The political economy focuses on the interplay of government with other societal factors. More recently, a third option has arrived on the scene: the knowledge-based economy.
The knowledge-based economy emphasizes the role of knowledge on a broad scale. Such an economy emphasizes the role of university research and technology in development, as well as the role of social sciences in political understanding. Although it takes a more global view than its predecessors, it still leaves room for national and regional systems of innovation.
“Previously you had the market and the government. You now also have the knowledge dimension, which makes a difference, so you have a three dimensional system,” says Loet Leydesdorff, a sociologist and expert in the knowledge-based economy at the University of Amsterdam. “That brings the universities center stage, because they’re leading in the knowledge system most of the time.”
In the mid 1990s, Leydesdorff led the creation of the “triple helix” metaphor to define industry-government-university synergy. This early description soon became known as the knowledge-based economy. More recently, he helped publish a paper on the Globalization of Academic Entrepreneurship.
Leydesdorff emphasizes that the knowledge-based economy doesn’t mean that universities serve industry or the government. They retain their original missions and focus, but the knowledge-based economy brings them center stage. Some universities and fields fit well with industry in their original mission, while others focus more on theoretical research, which tends to be somewhat separate. Ultimately, it’s about sharing.
Trends in the knowledge-based economy
Patents and intellectual property (IP) form a cornerstone of the knowledge-based economy. When the Bayh-Dole Act was passed in the US in 1980, it redefined the role of the university in innovation. Suddenly, universities could patent their discoveries and turn them into inventions, which they did. Other countries, like Belgium, soon followed suit.
Patenting is expensive, though, and universities realized that if they patented something that wasn’t licensed, they would lose money. That led to a decline in university patenting starting in 1998. In its place, a close relationship between industries and universities has emerged.
Universities often leave the risks of patenting to industry, and those patents form the basis of a close partnership from which both sides benefit. Universities get access to equipment, resources and machinery they wouldn’t otherwise be able to use, and industry brings in strong researchers who may come up with patentable discoveries.
“Patenting is the flag,” says Leydesdorff. “It’s the most visible symbol of a university-industry collaboration, but the main driver is the money.”
Patents can also lead to the creation of startups. These businesses are often started by professors and students who have patented their discoveries, and the startups can then be bought by corporations for millions of dollars.
Leydesdorff says that the next step in this evolution should be the democratization of innovation. These discoveries and patents should be disclosed to public audiences so that members of the general public can start companies based on them.
“If you do it only for industry, you’re more or less taking for granted that the incumbents are most important,” he says. “Startups are the most important. So we need to climb into where knowledge is more pronounced.”
Knowledge-sharing between academics and corporations
Whether formal or informal, the relationship between academics and corporations can best be described as an exchange, not only of ideas, but of resources and discoveries. In some fields, this hasn’t emerged as an important factor, but in others it’s crucial.
Many of the most marketed corporate technologies got their start in universities, so it’s easy to see what universities can bring to the table in terms of collaboration. They need industry’s resources and abilities, but industry also needs the research provided by academia. To attract collaboration, academia must simply make itself more accessible.
“In universities nowadays, education is close to students and to colleagues, but not to third parties,” says Leydesdorff. “We put a lot of effort into making nice websites for students and to make ourselves visible to colleagues.”
When it comes to reaching out to industry and the public, academia simply hasn’t done enough. By articulating its discoveries in simple terms in websites and reports written for non-academics, universities can foster the sharing of information – and through that, innovation.
Leydesdorff emphasizes that universities must never work only in the service of industry, but it’s also destructive to be isolated from industry. The key to success is the sharing of knowledge, whether through formal collaboration, symposia or other forms. It’s a knowledge-based economy, and knowledge should be the base of collaboration.
It’s synergy with industry, government and academia building upon each other with their own strengths so that the whole is greater than the sum of its parts, Leydesdorff explains.
“We need something like open-mindedness, long-term perspectives where research agendas can be shared, where there’s a division of labor,” he says.
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