EK - SABF 2007- Knowledge Economy and Sustainable Development-August07-Comp

8/15/2019 EK - SABF 2007- Knowledge Economy and Sustainable Development-August07-Comp

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SABF 2007

Sustainable Development, Knowledge

Economies:an agenda for developing countries?

Emiliano [email protected]

http://www.aconcaguaventures.com/blog
mailto:[email protected]:[email protected]:[email protected]:[email protected]


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About me

I spent the last 15 years of my life buildingand thinking about building innovativetechnology

I co-founded , a globalinformation security software companydoing great

I recently launched , amix of incubator+early stage fund, to help

others build successful high-growth, global


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*more* About me

Diaspora Networks

ECODAR

RAICES

LATIPNET

Spend my free time thinking abouthow to help Argentina become a

greater, better place


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Methodology

Today we will be entering the realmsof pure speculative thought

We will be supported there by alifetime of eclectic readings andwikipedia

And we will hope to emerge on the

other side of this 1 hours withsome insi ht


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Fairy Tales


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Sustainable Development:

development that meets theneeds of the present withoutcompromising the ability of future

generations to meet their needs


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The Knowledge Economy:

The perception that Physicalresources can be stretchedinfinitely by a certain

substitution with informationalresources (aka knowledge)


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Trying to be more specific


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It is claimed that


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Knowledge economy #1:

the rules of success in theindustrial economy needrewriting: know-how, expertise,intellectual property are more

important than land, naturalresources or man-power


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An idea closely knitted withthat of


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Post-Industrialism


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Post-Industrialism:

A post-industrial society is a

society in which an economictransition has occurred from amanufacturing based economy toa service based economy, a

diffusion of national and globalcapital, and mass privatization.


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This, of course, is made veryclear once we look at


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The relative significance ofcurrent struggles to control oil-

producing countries and barrelprices

All Photos made by David Leeson, SPC Ben Ballad, Columbus Ledger &Romeo Gacad


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Or, put more aseptically

If l k t th bi t


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If one looks at the biggestpublicly traded company in the

world

With a market cap of 429.5 Billion USD

(Clearly dealing in knowledge)


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But I may be pushing It alittle


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We could look at the top 15

Rank Name Headquarters Industry

Market value

(USDmillion)

Revenue

(2006,USDbillion)1 Exxon Mobil United States Oil and gas 429,567 377.6

2 General Electric United States Conglomerate 363,611 163.4

3 Microsoft United States Software industry 272,912 51.1

4 Citigroup United States Banking 252,857 120.3

5 AT&T United States Telecommunications 246,206 63.1

6 Gazprom Russia Oil and gas 245,911 83.6 (~)

7 Toyota Motor Corporati Japan Automotive 230,832 196 (~)

8 Bank of America United States Banking 228,177 117.0

9 Industrial and Commer China Banking 224,788 17.6 (~)

10 Royal Dutch Shell Netherlands Oil and gas 214,018 318.8

11 BP United Kingdom Oil and gas 208,844 274.3

12 HSBC United Kingdom Banking 202,146 70.1

13 Procter & Gamble United States Consumer goods 199,294 68.2

14 Wal-Mart United States Retail 193,643 351.1

15 Altria United States Tobacco, Food 184,277 101.4
http://en.wikipedia.org/wiki/USDhttp://en.wikipedia.org/wiki/Exxon_Mobilhttp://en.wikipedia.org/wiki/United_Stateshttp://en.wikipedia.org/wiki/Petroleum_industryhttp://en.wikipedia.org/wiki/General_Electrichttp://en.wikipedia.org/wiki/Conglomerate_(company)http://en.wikipedia.org/wiki/Microsofthttp://en.wikipedia.org/wiki/Software_industryhttp://en.wikipedia.org/wiki/Citigrouphttp://en.wikipedia.org/wiki/Bankinghttp://en.wikipedia.org/wiki/AT&Thttp://en.wikipedia.org/wiki/Telecommunicationshttp://en.wikipedia.org/wiki/Gazpromhttp://en.wikipedia.org/wiki/Russiahttp://en.wikipedia.org/wiki/Toyota_Motor_Corporationhttp://en.wikipedia.org/wiki/Japanhttp://en.wikipedia.org/wiki/Automotivehttp://en.wikipedia.org/wiki/Bank_of_Americahttp://en.wikipedia.org/wiki/Industrial_and_Commercial_Bank_of_Chinahttp://en.wikipedia.org/wiki/People's_Republic_of_Chinahttp://en.wikipedia.org/wiki/People's_Republic_of_Chinahttp://en.wikipedia.org/wiki/Royal_Dutch_Shellhttp://en.wikipedia.org/wiki/Netherlandshttp://en.wikipedia.org/wiki/BPhttp://en.wikipedia.org/wiki/United_Kingdomhttp://en.wikipedia.org/wiki/HSBChttp://en.wikipedia.org/wiki/Procter_&_Gamblehttp://en.wikipedia.org/wiki/Consumer_goodshttp://en.wikipedia.org/wiki/Wal-Marthttp://en.wikipedia.org/wiki/Retailhttp://en.wikipedia.org/wiki/Altriahttp://en.wikipedia.org/wiki/Tobacco_industryhttp://en.wikipedia.org/wiki/Food_Industryhttp://en.wikipedia.org/wiki/Food_Industryhttp://en.wikipedia.org/wiki/Tobacco_industryhttp://en.wikipedia.org/wiki/Altriahttp://en.wikipedia.org/wiki/Retailhttp://en.wikipedia.org/wiki/Wal-Marthttp://en.wikipedia.org/wiki/Consumer_goodshttp://en.wikipedia.org/wiki/Procter_&_Gamblehttp://en.wikipedia.org/wiki/HSBChttp://en.wikipedia.org/wiki/United_Kingdomhttp://en.wikipedia.org/wiki/BPhttp://en.wikipedia.org/wiki/Netherlandshttp://en.wikipedia.org/wiki/Royal_Dutch_Shellhttp://en.wikipedia.org/wiki/People's_Republic_of_Chinahttp://en.wikipedia.org/wiki/Industrial_and_Commercial_Bank_of_Chinahttp://en.wikipedia.org/wiki/Bank_of_Americahttp://en.wikipedia.org/wiki/Automotivehttp://en.wikipedia.org/wiki/Japanhttp://en.wikipedia.org/wiki/Toyota_Motor_Corporationhttp://en.wikipedia.org/wiki/Russiahttp://en.wikipedia.org/wiki/Gazpromhttp://en.wikipedia.org/wiki/Telecommunicationshttp://en.wikipedia.org/wiki/AT&Thttp://en.wikipedia.org/wiki/Bankinghttp://en.wikipedia.org/wiki/Citigrouphttp://en.wikipedia.org/wiki/Software_industryhttp://en.wikipedia.org/wiki/Microsofthttp://en.wikipedia.org/wiki/Conglomerate_(company)http://en.wikipedia.org/wiki/General_Electrichttp://en.wikipedia.org/wiki/Petroleum_industryhttp://en.wikipedia.org/wiki/United_Stateshttp://en.wikipedia.org/wiki/Exxon_Mobilhttp://en.wikipedia.org/wiki/USD


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So we will pause here


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to take a little detour into


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The Division of Laborthe rise of trade, and capitalism


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"Well then, how will our state supplythese needs? It will need a farmer, a

builder, and a weaver, and also, Ithink, a shoemaker and one or twoothers to provide for our bodily

needs. So that the minimum statewould consist of four or five men...."

(Plato - The Republic,360BC)


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One man draws out the wire, anotherstraights it, a third cuts it, a fourth

points it, a fifth grinds it at the top forreceiving the head: to make the headrequires two or three distinctoperations: to put it on is a particularbusiness, to whiten the pins is another...*

(Adam Smith An Inquiry intothe Nature and

Causes of the Wealth of Nations, 1776)


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With this division of labour on the onehand and the accumulation of capitalon the other, the worker becomes evermore exclusively dependent on labour,and on a particular, very one-sided,

machine-like labour at that. just as he isthus depressed spiritually and physically to the condition of amachine

(Karl Marx Wages of Labour,1844)

He also made a distinction between Technical andSocial reasons for the division of Labor ie: who


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As the rise of capitalism andtrade was accompanied bythe division of labor

(and the concept of value chain )


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Industrialization was

accompanied by aninternational division of

labor


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Primary and SecondaryExports

worldmapper.c


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And the corresponding valuechain brought a natural

distinction of rich(industrialized) and poor

countries


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And then came Trans-National Companies


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And Globalization


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And Post-Industrialism is, in

a sense, making a strangesense:


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As countries become

service providers for Trans-Nationals


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And advanced capitalist

countries are undergoing anindustrial devolution


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While newly industrialized

countries precipitate in debtcrisis


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A new, Trans-National division

of labor rises accompanied byits own value chains


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OK


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But what exactly isSustainable Development?


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What exactly is SustainableDevelopment?


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A Global ecology and economywith very specific local/regional

problems


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gives rise to a fallacy oflocal optimization


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Allow me a very briefsecond detour


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into Thermodynamics

Economy and Thermodynamics

Complex systems where mechanicalstate is replaced by a statistical

dynamic state System / Work

Thermodynamic processes

Equilibrium

Efficiency


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But we might be getting tooesoteric


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So lets go back to anexample


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The Kyoto Protocol

The Kyoto protocol (1997)mandatory limitations for the reduction of greenhousegas emissions of the signatory nations

ANNEX 1 Countries Obligations to reduce or trade

ANNEX 2 Countries No obligations, can participate inCDM

The Byrd-Hagel ResolutionOnJuly 25, 1997 the U.S. Senate unanimously passed by

a 950 vote the Byrd-Hagel Resolution : the Senate wasthat the United States should not be a signatory to anyprotocol that did not include binding targets andtimetables for developing as well as industrializednations or "would result in serious harm to the economyof the United States"
http://en.wikipedia.org/wiki/July_25http://en.wikipedia.org/wiki/1997http://en.wikipedia.org/wiki/1997http://en.wikipedia.org/wiki/July_25


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At this point I want to reachtwo conclusions


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1) We have to be very carefulof doubletalk


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2) The complexity of worldeconomics is mindboggling


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OK


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I read a paper a month ago


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Written in 1971 by MarceloDiamand,Argentine Engineer

and Industrial Businessman

Marcelo Diamand. La Estructura ProductivaDesequilibrada Argentina y el Tipo de Cambio;

Desarrollo Econmico Vol. 12 N 45. 1972.


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In a very simple language he

explained Argentinas cycliccrisis based on a simple

structural distinction

Of t b l d d ti


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Of two unbalanced productivestructures


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Some things have change

since 71(not precisely the cyclic crisis in

.ar)


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Industrialization is no longer

part of the developmentagenda


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As it is not consistent with

free-trade, and thusGlobalization


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But Sustainable EconomicDevelopment is always some

kind of Virtuous Circle

Development as a virtuous


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Development as a virtuouscycle

Outside

demand


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So, where to?


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I said at the beginning that I work ontrying to get Argentina to change itsproductive profile towardsknowledge-based industries.

Why?


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Knowledge economy #2:

The use of knowledge to produce

economic benefits;

innovation as the premium sourceof value-added production;

This are not radically-new ideas


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The question should be


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How to create value fromknowledge and surf the globe?


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This is what Im working on

Ecosystems for value creation


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Ecosystems for value creationin the knowledge economy

Development of Human Capital Basic Science Science and Technology Management skills

Jumping from knowledge to value creation

Intellectual Property Company Formation Financing layers

Services value-chain

FOCUS on high value-add: high growth!The orders of magnitude law

Ecosystems for value creation


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Ecosystems for value creationin the knowledge economy


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OK

What Sustainable Development


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What Sustainable Developmentcan be

A fairy tale

A sweet-sounding excuse for yetanother hidden post-industrialist,

imperialistic agenda

An imperative for a moraldevelopment schedule on a global

basis

The ball is in our court

EK - SABF 2007- Knowledge Economy and Sustainable Development-August07-Comp

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