E-development and knowledge economy: The role of ICT and SME incubation

Abstract

In classical economics, land, labor, and capital are the only factors of production. Knowledge, productivity, education, and intellectual capital are all regarded as exogenous factors, falling outside the system. The New Growth Theory recognizes two additional factors: technology, and the knowledge on which it is based. In today's environment, technology and knowledge are not merely additional factors of production; they have become the key factors of production. Two thematic areas are central to the analysis here: using business incubators for new venture formation, and using information and communications technology (ICT) to support and promote small- and medium-sized enterprises (SMEs). Knowledge Economy demands knowledge. Entrepreneurs need the knowledge to build a reliable infrastructure using incubators for new venture formation. New technology businesses need to move through the growth process rapidly and get their products to market before they run out of resources. Businesses need to use technology clusters to stimulate sustained innovation and growth. Educators need the knowledge to educate in ICT and e-business, attaining digital literacy for all of society, and providing the knowledge to accelerate and embrace e-commerce. Policy makers need the knowledge to accelerate and embrace e-government, providing electronic access to public services, enacting a regulatory environment conducive to the advancement of Science and Technology, and committing public policy to stimulate and assure innovation.