1. Korea as a Knowledge Economy
Bruno A. Laporte
The Knowledge for Development (K4D) Program
The World Bank
©Knowledge for Development, WBI

2. Knowledge Economy Report on Korea
Korea as a Knowledge Economy: Evolutionary Process and Lessons Learned
Second World Bank Institute knowledge economy report on Korea
Targeted at policymakers of developing countries
Jointly produced with the Korea Development Institute
In addition to WBI staff, 10 Korean authors from KDI, KISDI, Ewha Womens University, KEDI, STEPI contributed to the report
©Knowledge for Development, WBI

3. Knowledge Economy Report on Korea
Why is Korea an exemplary knowledge economy?
Rapid and sustained economic growth rates over the past 45 years
Economic growth was predominantly driven by productivity growth
Utilized knowledge-based development strategies to move the economy through the various stages of economic development
©Knowledge for Development, WBI

4. Korea - Real GDP Per Capita
©Knowledge for Development, WBI

5. Knowledge & Economic Growth
©Knowledge for Development, WBI

6. Knowledge Economy Framework
A Knowledge Economy
Uses knowledge as a key engine of growth
Knowledge is acquired, created, disseminated, used to enhance economic development
KE Framework
A conducive economic incentive and institutional regime
An educated and skilled labor force
An effective innovation system
A modern and adequate information infrastructure
Knowledge for Development Program (K4D) 2006

7. Knowledge Economy Framework
Provides incentives for the efficient creation,
dissemination,
and use of
existing
knowledge
Necessary for the creation and effective use of knowledge
Economic and Institutional Regime
Education
Interconnected
Interdependent
EIR that provides incentives for the efficient use of existing and new knowledge and the flourishing of entrepreneurship
Information Infrastructure
Innovation
Effective system
of firms, research
centers, universities
that can tap into
global knowledge,
assimilate and adapt it
and create local knowledge
To facilitate
the effective
communication,
dissemination,
and processing
of information

8. Knowledge Assessment Methodology
Internet-based benchmarking tool
Developed by the K4D Program
Based on the KE framework; provides basic assessment of KE readiness
Comparisons performed on the basis of 80 structural and qualitative variables
All variables are normalized to take values from 0 (weakest) to 10 (strongest)
Knowledge for Development Program (K4D) 2006

9. KAM: Knowledge Indexes
Knowledge Economy Index (KEI)
Knowledge Index (KI)
Economic Incentive and Institution Regime Index
Education Index
Innovation Index
ICT Index
Tariff & Nontariff Barriers
Regulatory Quality
Rule of Law
Adult Literacy Rate
Secondary Enrollment
Tertiary Enrollment
R&D Researchers
Patent Count
Journal Articles
Telephones
Computers
Internet Users

10. KAM: Basic Scorecard
© K4D program

11. KAM: Basic Scorecard
© K4D program

12. KAM : Knowledge Economy Index
Korea KEI = 7.48
© K4D program

13. Information Infrastructure
© K4D program

14. Policy Lessons Knowledge-based development strategies
Leads to increased productivity
Sustained economic growth
Gradual investment in the KE pillars
Complementarities and coordination between pillars
Pace and level of investment synchronized with stage of economic development
Knowledge economic approach relevant for any stage of economic development
Knowledge for Development Program (K4D) 2006

15. Policy Lessons Market-Based Approach Export-led industrialization
Necessary for competitive forces that induce efficiency
Successful government policies complemented and facilitated the functioning of the market
Export-led industrialization
Korean industries had to invest in R&D to improve productivity to compete in the global market
Knowledge for Development Program (K4D) 2006

16. Policy Lessons Pivotal Role of Government
Strong government leadership
Role evolved over time together with needs of economy
Top-down and Bottom-up approach
Necessary to build national consensus
Knowledge for Development Program (K4D) 2006