The Economics of Knowledge [Hardcover]

Dominique Foray (Author)

Book Description

ISBN-10: 0262062399 | ISBN-13: 978-0262062398 | Publication Date: April 1, 2004

The economics of knowledge is a rapidly emerging subdiscipline of economics that has never before been given the comprehensive and cohesive treatment found in this book. Dominique Foray analyzes the deep conceptual and structural transformation of our economic activities that has led to a gradual shift to knowledge-intensive activities. This transformation is the result of the collision of a longstanding trend—the expansion of knowledge-based investments and activities—with a technological revolution that radically altered the production and transmission of knowledge and information. The book focuses on the dual nature of the economics of knowledge: its emergence as a discipline (which Foray calls "the economics of knowledge") and the historical development of a particular period in the growth and organization of economic activities ("the knowledge-based economy").

The book, which alternates between analysis of the economic transformation and examination of the tools and concepts of the discipline, begins by discussing "knowledge" as an economic good and the historical development of the knowledge-based economies. It then develops a conceptual framework for considering the issues raised. Topics considered in the remaining chapters include forms of knowledge production, codification and infusion, incentives and institutions for the efficient production of knowledge (including discussions of private markets and "open" sources), and knowledge management as a new organizational capability. Finally, the book addresses policy concerns suggested by the uneven development of knowledge across different sectors and by the need to find ways of reclaiming the public dimension of knowledge from an essentially privatized knowledge revolution.

Editorial Reviews

Review

"Despite frequent reference to the knowledge-based economy, there is little common understanding about what makes it work and how knowledge differs from conventional economic resources. In The Economics of Knowledge, Dominique Foray gives us a rich, pioneering account of the special economic characteristics of knowledge, how they challenge business management and strategy, and, especially important, implications for public policies toward education, research, and intellectual property."
—Brian Kahin, Visiting Professor, University of Michigan, former Senior Policy Analyst, White House Office of Science and Technology Policy

"Dominique Foray is to be congratulated for producing the first full-blown text on the economics of knowledge. This wide ranging, interesting, and valuable book will surely be the touchstone by which other studies are judged. Foray focuses hard on knowledge itself, not information or data, and by doing so has produced an original and much needed study."
—Larry Prusak, Distinguished Scholar, Babson College

"Foray has put together a masterly and much-needed book on the economics of knowledge that brings in ideas from law, management, and sociology. The result is a definitive and overarching statement of what we know and where we next need to go."
—Danny Quah, Professor of Economics, London School of Economics and Political Science

"This is a very important and creative book, in which Foray makes a strong case that the economics of knowledge is an important discipline in microeconomics. He synthesizes several strains of research to create a clear vision of a general scientific program in that field, and identifies a core of hypotheses (that knowledge is a public good, that learning-by-doing is a joint product) as important to further progress. He also articulates a central objective for the discipline: To understand the functioning of socioeconomic institutions that can be relied upon to produce and use knowledge efficiently."
—Eric von Hippel, Sloan School of Management, MIT

From the Inside Flap

"Dominique Foray is to be congradulated for producing the first full-blown text on the economics of knowledge. This wide ranging, interesting, and valuable book will surely be the touchstone by which other studies are judged. Foray focuses hard on knowledge itself, not information or data, and by doing so has produced an original and much needed study."
--Larry Prusak, Distinguished Scholar, Babson College

"Despite frequent reference to the knowledge-based economy, there is little common understanding about what makes it work and how knowledge differs from conventional economic resources. In *The Economics of Knowledge*, Dominique Foray gives us a rich, pioneering account of the special economic characteristics of knowledge, how they challenge business management and strategy, and, especially important, implications for public policies toward education, research, and intellectual property."
--Brian Kahin, Visiting Professor, University of Michigan, former Senior Policy Analyst, White House Office of Science and Technology Policy

"Foray has put together a masterly and much-needed book on the economics of knowledge that brings in ideas from law, management, and sociology. The result is a definitive and overarching statement of what we know and where we next need to go."
--Danny Quah, Professor of Economics, London School of Economics and Political Science

"This is a very important and creative book, in which Foray makes a strong case that the economics of knowledge is an important discipline in microeconomics. He synthesizes several strains of research to create a clear vision of a general scientific program in that field, and identifies a core of hypotheses (that knowledge is a public good, that learning-by-doing is a joint product) as important to further progress. He also articulates a central objective for the discipline: To understand the functioning of socioeconomic institutions that can be relied upon to produce and use knowledge efficiently."
--Eric von Hippel, Sloan School of Management, MIT

See all Editorial Reviews

Product Details

• Hardcover: 287 pages
• Publisher: The MIT Press (April 1, 2004)
• Language: English
• ISBN-10: 0262062399
• ISBN-13: 978-0262062398
• Product Dimensions: 9.1 x 6.2 x 0.8 inches
• Shipping Weight: 1.1 pounds
• Average Customer Review: 4.0 out of 5 stars  See all reviews (1 customer review)
• Amazon Best Sellers Rank: #2,470,473 in Books (See Top 100 in Books)

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3 of 3 people found the following review helpful:

4.0 out of 5 stars ECONOMIZING ON WHAT WE KNOW, December 19, 2007

By 

W. Sheridan "Epistemological Entrepreneur" (Ottawa, Canada) - See all my reviews

This review is from: The Economics of Knowledge (Paperback)

The "idealized" sense of knowledge places it at the opposite end of the spectrum from considerations of cost and benefit, profit and loss. That esoteric sense of knowledge prevailed from the pre-Socratics to the Renaissance. However the Enlightenment and the subsequent Modern Era challenged that view and have been successively replacing it with a practical, if mundane alternative. But even though the esoteric view is now obsolete, it hovers like Hamlet's ghost in the background, with the result that few have actually developed a formal analysis of "knowledge transactions." Prof. Foray has now excoriated that ghost.

As it turns out however, there is a lot of ground to cover in any attempt to introduce an economic analysis of the important characteristics of knowledge. In a basic sense, the two encompassing categories of concern are the "internal" and the "external" aspects of knowledge. Foray tackles both in a comprehensive overview. The internal aspect refers to the generation and organization of knowledge itself, to the costs and benefits of producing something that is reliable enough to be designated an economic resource. The external aspect refers to the economic utilization and social impact of knowledge, how it bears on the calculations of profit and loss, and how it is becoming an increasing source of value-added if properly used.

The book covers everything from Patent Law to the Public Good, because knowledge figures intrinsically in each of these factors. Analytically speaking, knowledge is like a horizontal layer that passes through all of the vertical specialities, including law, public policy, industrial organization, and market activities. What Foray does is to set the context for further research and theorizing in each of these areas - there are so many factors that none of them can be covered in great depth. Still, this book is the guide for what remains to be done, which is developing a more refined economic analysis of each of the areas where the economics of knowledge has a bearing on how knowledge is produced and mobilized for purposes of productivity and/or creativity.