Why all this fuss about codified and tacit knowledge?

Abstract

This paper starts with a critical assessment of the recent paper by Cowan, Foray and David. It also provides the authors' own assessment of why the tacit/codified distinction is important in relation to economic analysis and knowledge management practice. The criticism of Cowan, Foray and David centres on three points. Firstly, it is argued that the discussion on codification must make the fundamental distinction between knowledge about the world (know-what) and knowledge in the form of skills and competence (know-how). Secondly, it is argued that the dichotomy between codifiable and non-codifiable knowledge is problematic since it is rare that a body of knowledge can be completely transformed into codified form without losing some of its original characteristics and that most forms of relevant knowledge are mixed in these respects. Thirdly, we contest their implicit assumption that codification always represents progress. We conclude that for these reasons their intellectual exercise of extending definitions of what is codified and possible to codify, while in principle addressing very important issues related to innovation policy and knowledge management, ends up having limited practical implications for these areas.