research on the knowledge economy

About Stanford GSB

• The Leadership
• Dean’s Updates
• School News & History
• Commencement
• Business, Government & Society
• Centers & Institutes
• Center for Entrepreneurial Studies
• Center for Social Innovation
• Stanford Seed

About the Experience

• Learning at Stanford GSB
• Experiential Learning
• Guest Speakers
• Entrepreneurship
• Social Innovation
• Communication
• Life at Stanford GSB
• Collaborative Environment
• Activities & Organizations
• Student Services
• Housing Options
• International Students

Full-Time Degree Programs

• Why Stanford MBA
• Academic Experience
• Financial Aid
• Why Stanford MSx
• Research Fellows Program
• See All Programs

Non-Degree & Certificate Programs

• Executive Education
• Stanford Executive Program
• Programs for Organizations
• The Difference
• Online Programs
• Stanford LEAD
• Stanford Innovation and Entrepreneurship Certificate
• Seed Transformation Program
• Aspire Program
• Seed Spark Program
• Faculty Profiles
• Academic Areas
• Awards & Honors
• Conferences

Faculty Research

• Publications
• Working Papers
• Case Studies

Research Hub

• Research Labs & Initiatives
• Business Library
• Data, Analytics & Research Computing
• Behavioral Lab

Research Labs

• Cities, Housing & Society Lab
• Golub Capital Social Impact Lab

Research Initiatives

• Corporate Governance Research Initiative
• Corporations and Society Initiative
• Policy and Innovation Initiative
• Rapid Decarbonization Initiative
• Stanford Latino Entrepreneurship Initiative
• Value Chain Innovation Initiative
• Venture Capital Initiative
• Career & Success
• Climate & Sustainability
• Corporate Governance
• Culture & Society
• Finance & Investing
• Government & Politics
• Leadership & Management
• Markets & Trade
• Operations & Logistics
• Opportunity & Access
• Organizational Behavior
• Political Economy
• Social Impact
• Technology & AI
• Opinion & Analysis
• Email Newsletter

Welcome, Alumni

• Communities
• Digital Communities & Tools
• Regional Chapters
• Women’s Programs
• Identity Chapters
• Find Your Reunion
• Career Resources
• Job Search Resources
• Career & Life Transitions
• Programs & Services
• Career Video Library
• Alumni Education
• Research Resources
• Volunteering
• Alumni News
• Class Notes
• Alumni Voices
• Contact Alumni Relations
• Upcoming Events

Admission Events & Information Sessions

• MBA Program
• MSx Program
• PhD Program
• Alumni Events
• All Other Events
• Operations, Information & Technology
• Classical Liberalism
• The Eddie Lunch
• Accounting Summer Camp
• Videos, Code & Data
• California Econometrics Conference
• California Quantitative Marketing PhD Conference
• California School Conference
• China India Insights Conference
• Homo economicus, Evolving
• Political Economics (2023–24)
• Scaling Geologic Storage of CO2 (2023–24)
• A Resilient Pacific: Building Connections, Envisioning Solutions
• Adaptation and Innovation
• Changing Climate
• Civil Society
• Climate Impact Summit
• Climate Science
• Corporate Carbon Disclosures
• Earth’s Seafloor
• Environmental Justice
• Operations and Information Technology
• Organizations
• Sustainability Reporting and Control
• Taking the Pulse of the Planet
• Urban Infrastructure
• Watershed Restoration
• Junior Faculty Workshop on Financial Regulation and Banking
• Ken Singleton Celebration
• Quantitative Marketing PhD Alumni Conference
• Presentations
• Theory and Inference in Accounting Research
• Stanford Closer Look Series
• Quick Guides
• Core Concepts
• Journal Articles
• Glossary of Terms
• Faculty & Staff
• Researchers & Students
• Research Approach
• Charitable Giving
• Financial Health
• Government Services
• Workers & Careers
• Short Course
• Adaptive & Iterative Experimentation
• Incentive Design
• Social Sciences & Behavioral Nudges
• Bandit Experiment Application
• Conferences & Events
• Get Involved
• Reading Materials
• Teaching & Curriculum
• Energy Entrepreneurship
• Faculty & Affiliates
• SOLE Report
• Responsible Supply Chains
• Current Study Usage
• Pre-Registration Information
• Participate in a Study

The Knowledge Economy

We define the knowledge economy as production and services based on knowledge-intensive activities that contribute to an accelerated pace of technical and scientific advance, as well as rapid obsolescence. The key component of a knowledge economy is a greater reliance on intellectual capabilities than on physical inputs or natural resources. We provide evidence drawn from patent data to document an upsurge in knowledge production and show that this expansion is driven by the emergence of new industries. We then review the contentious literature that assesses whether recent technological advances have raised productivity. We examine the debate over whether new forms of work that embody technological change have generated more worker autonomy or greater managerial control. Finally, we assess the distributional consequences of a knowledge-based economy with respect to growing inequality in wages and high-quality jobs.

• See the Current DEI Report
• Supporting Data
• Research & Insights
• Share Your Thoughts
• Search Fund Primer
• Affiliated Faculty
• Faculty Advisors
• Louis W. Foster Resource Center
• Defining Social Innovation
• Impact Compass
• Global Health Innovation Insights
• Faculty Affiliates
• Student Awards & Certificates
• Changemakers
• Dean Jonathan Levin
• Dean Garth Saloner
• Dean Robert Joss
• Dean Michael Spence
• Dean Robert Jaedicke
• Dean Rene McPherson
• Dean Arjay Miller
• Dean Ernest Arbuckle
• Dean Jacob Hugh Jackson
• Dean Willard Hotchkiss
• Faculty in Memoriam
• Stanford GSB Firsts
• Certificate & Award Recipients
• Dean’s Remarks
• Keynote Address
• Teaching Approach
• Analysis and Measurement of Impact
• The Corporate Entrepreneur: Startup in a Grown-Up Enterprise
• Data-Driven Impact
• Designing Experiments for Impact
• Digital Business Transformation
• The Founder’s Right Hand
• Marketing for Measurable Change
• Product Management
• Public Policy Lab: Financial Challenges Facing US Cities
• Public Policy Lab: Homelessness in California
• Lab Features
• Curricular Integration
• View From The Top
• Formation of New Ventures
• Managing Growing Enterprises
• Startup Garage
• Explore Beyond the Classroom
• Stanford Venture Studio
• Summer Program
• Workshops & Events
• The Five Lenses of Entrepreneurship
• Leadership Labs
• Executive Challenge
• Arbuckle Leadership Fellows Program
• Selection Process
• Training Schedule
• Time Commitment
• Learning Expectations
• Post-Training Opportunities
• Who Should Apply
• Introductory T-Groups
• Leadership for Society Program
• Certificate
• 2023 Awardees
• 2022 Awardees
• 2021 Awardees
• 2020 Awardees
• 2019 Awardees
• 2018 Awardees
• Social Management Immersion Fund
• Stanford Impact Founder Fellowships and Prizes
• Stanford Impact Leader Prizes
• Social Entrepreneurship
• Stanford GSB Impact Fund
• Economic Development
• Energy & Environment
• Stanford GSB Residences
• Environmental Leadership
• Stanford GSB Artwork
• A Closer Look
• California & the Bay Area
• Voices of Stanford GSB
• Business & Beneficial Technology
• Business & Sustainability
• Business & Free Markets
• Business, Government, and Society Forum
• Second Year
• Global Experiences
• JD/MBA Joint Degree
• MA Education/MBA Joint Degree
• MD/MBA Dual Degree
• MPP/MBA Joint Degree
• MS Computer Science/MBA Joint Degree
• MS Electrical Engineering/MBA Joint Degree
• MS Environment and Resources (E-IPER)/MBA Joint Degree
• Academic Calendar
• Clubs & Activities
• LGBTQ+ Students
• Military Veterans
• Minorities & People of Color
• Partners & Families
• Students with Disabilities
• Student Support
• Residential Life
• Student Voices
• MBA Alumni Voices
• A Week in the Life
• Career Support
• Employment Outcomes
• Cost of Attendance
• Knight-Hennessy Scholars Program
• Yellow Ribbon Program
• BOLD Fellows Fund
• Application Process
• Loan Forgiveness
• Contact the Financial Aid Office
• Evaluation Criteria
• GMAT & GRE
• English Language Proficiency
• Personal Information, Activities & Awards
• Professional Experience
• Letters of Recommendation
• Optional Short Answer Questions
• Application Fee
• Reapplication
• Deferred Enrollment
• Joint & Dual Degrees
• Entering Class Profile
• Event Schedule
• Ambassadors
• New & Noteworthy
• Ask a Question
• See Why Stanford MSx
• Is MSx Right for You?
• MSx Stories
• Leadership Development
• Career Advancement
• Career Change
• How You Will Learn
• Admission Events
• Personal Information
• Information for Recommenders
• GMAT, GRE & EA
• English Proficiency Tests
• After You’re Admitted
• Daycare, Schools & Camps
• U.S. Citizens and Permanent Residents
• Requirements
• Requirements: Behavioral
• Requirements: Quantitative
• Requirements: Macro
• Requirements: Micro
• Annual Evaluations
• Field Examination
• Research Activities
• Research Papers
• Dissertation
• Oral Examination
• Current Students
• Education & CV
• International Applicants
• Statement of Purpose
• Reapplicants
• Application Fee Waiver
• Deadline & Decisions
• Job Market Candidates
• Academic Placements
• Stay in Touch
• Faculty Mentors
• Current Fellows
• Standard Track
• Fellowship & Benefits
• Group Enrollment
• Program Formats
• Developing a Program
• Diversity & Inclusion
• Strategic Transformation
• Program Experience
• Contact Client Services
• Campus Experience
• Live Online Experience
• Silicon Valley & Bay Area
• Digital Credentials
• Faculty Spotlights
• Participant Spotlights
• Eligibility
• International Participants
• Stanford Ignite
• Frequently Asked Questions
• Founding Donors
• Location Information
• Participant Profile
• Network Membership
• Program Impact
• Collaborators
• Entrepreneur Profiles
• Company Spotlights
• Seed Transformation Network
• Responsibilities
• Current Coaches
• How to Apply
• Meet the Consultants
• Meet the Interns
• Intern Profiles
• Collaborate
• Research Library
• News & Insights
• Program Contacts
• Databases & Datasets
• Research Guides
• Consultations
• Research Workshops
• Career Research
• Research Data Services
• Course Reserves
• Course Research Guides
• Material Loan Periods
• Fines & Other Charges
• Document Delivery
• Interlibrary Loan
• Equipment Checkout
• Print & Scan
• MBA & MSx Students
• PhD Students
• Other Stanford Students
• Faculty Assistants
• Research Assistants
• Stanford GSB Alumni
• Telling Our Story
• Staff Directory
• Site Registration
• Alumni Directory
• Alumni Email
• Privacy Settings & My Profile
• Success Stories
• The Story of Circles
• Support Women’s Circles
• Stanford Women on Boards Initiative
• Alumnae Spotlights
• Insights & Research
• Industry & Professional
• Entrepreneurial Commitment Group
• Recent Alumni
• Half-Century Club
• Fall Reunions
• Spring Reunions
• MBA 25th Reunion
• Half-Century Club Reunion
• Faculty Lectures
• Ernest C. Arbuckle Award
• Alison Elliott Exceptional Achievement Award
• ENCORE Award
• Excellence in Leadership Award
• John W. Gardner Volunteer Leadership Award
• Robert K. Jaedicke Faculty Award
• Jack McDonald Military Service Appreciation Award
• Jerry I. Porras Latino Leadership Award
• Tapestry Award
• Student & Alumni Events
• Executive Recruiters
• Interviewing
• Land the Perfect Job with LinkedIn
• Negotiating
• Elevator Pitch
• Email Best Practices
• Resumes & Cover Letters
• Self-Assessment
• Whitney Birdwell Ball
• Margaret Brooks
• Bryn Panee Burkhart
• Margaret Chan
• Ricki Frankel
• Peter Gandolfo
• Cindy W. Greig
• Natalie Guillen
• Carly Janson
• Sloan Klein
• Sherri Appel Lassila
• Stuart Meyer
• Tanisha Parrish
• Virginia Roberson
• Philippe Taieb
• Michael Takagawa
• Terra Winston
• Johanna Wise
• Debbie Wolter
• Rebecca Zucker
• Complimentary Coaching
• Changing Careers
• Work-Life Integration
• Career Breaks
• Flexible Work
• Encore Careers
• D&B Hoovers
• Data Axle (ReferenceUSA)
• EBSCO Business Source
• Firsthand (Vault)
• Global Newsstream
• Market Share Reporter
• ProQuest One Business
• Student Clubs
• Entrepreneurial Students
• Stanford GSB Trust
• Alumni Community
• How to Volunteer
• Springboard Sessions
• Consulting Projects
• 2020 – 2029
• 2010 – 2019
• 2000 – 2009
• 1990 – 1999
• 1980 – 1989
• 1970 – 1979
• 1960 – 1969
• 1950 – 1959
• 1940 – 1949
• Service Areas
• ACT History
• ACT Awards Celebration
• ACT Governance Structure
• Building Leadership for ACT
• Individual Leadership Positions
• Leadership Role Overview
• Purpose of the ACT Management Board
• Contact ACT
• Business & Nonprofit Communities
• Reunion Volunteers
• Ways to Give
• Fiscal Year Report
• Business School Fund Leadership Council
• Planned Giving Options
• Planned Giving Benefits
• Planned Gifts and Reunions
• Legacy Partners
• Giving News & Stories
• Giving Deadlines
• Development Staff
• Submit Class Notes
• Class Secretaries
• Board of Directors
• Health Care
• Sustainability
• Class Takeaways
• All Else Equal: Making Better Decisions
• If/Then: Business, Leadership, Society
• Grit & Growth
• Think Fast, Talk Smart
• Spring 2022
• Spring 2021
• Autumn 2020
• Summer 2020
• Winter 2020
• In the Media
• For Journalists
• DCI Fellows
• Other Auditors
• Academic Calendar & Deadlines
• Course Materials
• Entrepreneurial Resources
• Campus Drive Grove
• Campus Drive Lawn
• CEMEX Auditorium
• King Community Court
• Seawell Family Boardroom
• Stanford GSB Bowl
• Stanford Investors Common
• Town Square
• Vidalakis Courtyard
• Vidalakis Dining Hall
• Catering Services
• Policies & Guidelines
• Reservations
• Contact Faculty Recruiting
• Lecturer Positions
• Postdoctoral Positions
• Accommodations
• CMC-Managed Interviews
• Recruiter-Managed Interviews
• Virtual Interviews
• Campus & Virtual
• Search for Candidates
• Think Globally
• Recruiting Calendar
• Recruiting Policies
• Full-Time Employment
• Summer Employment
• Entrepreneurial Summer Program
• Global Management Immersion Experience
• Social-Purpose Summer Internships
• Process Overview
• Project Types
• Client Eligibility Criteria
• Client Screening
• ACT Leadership
• Social Innovation & Nonprofit Management Resources
• Develop Your Organization’s Talent
• Centers & Initiatives
• Student Fellowships

• Search Search Please fill out this field.

What Is the Knowledge Economy?

• Knowledge and Human Capital
• Knowledge Economy FAQs

What Is the Knowledge Economy? Definition, Criteria, and Example

Adam Hayes, Ph.D., CFA, is a financial writer with 15+ years Wall Street experience as a derivatives trader. Besides his extensive derivative trading expertise, Adam is an expert in economics and behavioral finance. Adam received his master's in economics from The New School for Social Research and his Ph.D. from the University of Wisconsin-Madison in sociology. He is a CFA charterholder as well as holding FINRA Series 7, 55 & 63 licenses. He currently researches and teaches economic sociology and the social studies of finance at the Hebrew University in Jerusalem.

The knowledge economy is a system of consumption and production that is based on intellectual capital . In particular, it refers to the ability to capitalize on scientific discoveries and applied research.

The knowledge economy represents a large share of the activity in most highly developed economies . In a knowledge economy, a significant component of value may consist of intangible assets  such as the value of its workers' knowledge or intellectual property.

Key Takeaways

• The knowledge economy describes the contemporary commercialization of science and academic scholarship.
• In the knowledge economy, innovation based on research is commodified via patents and other forms of intellectual property.
• The knowledge economy lies at the intersection of private entrepreneurship, academia, and government-sponsored research.
• Knowledge-related industries represent a large share of the activity in most highly developed countries.
• A knowledge economy depends on skilled labor and education, strong communications networks, and institutional structures that incentivize innovation.

Understanding the Knowledge Economy

Developing economies tend to be heavily focused on agriculture and manufacturing, while highly developed countries have a larger share of service-related activities. This includes knowledge-based economic activities such as research, technical support, and consulting.

The knowledge economy is the marketplace for the production and sale of scientific and engineering discoveries. This knowledge can be commodified in the form of patents or other intellectual property protections. The producers of such information, such as scientific experts and research labs, are also considered part of the knowledge economy.

The Bayh-Dole Act of 1980 was a major turning point in the treatment of intellectual property in the U.S. because it allowed universities to retain title to inventions or discoveries made with federal R&D funding and to negotiate exclusive licenses.

Thanks to globalization, the world economy has become more knowledge-based, bringing with it the best practices from each country's economy. Also, knowledge-based factors create an interconnected and global economy where human expertise and trade secrets are considered important economic resources.

However, it is important to note that generally accepted accounting principles  (GAAP) do not allow companies to include these assets on their balance sheets.

The modern commercialization of academic research and basic science has its roots in governments seeking military advantage.

Knowledge Economy and Human Capital

The knowledge economy addresses how education and knowledge—that is, " human capital "— can serve as a productive asset or business product to be sold and exported to yield profits for individuals, businesses, and the economy.

This component of the economy relies greatly on intellectual capabilities instead of natural resources or physical contributions. In the knowledge economy, products, and services that are based on intellectual expertise advance technical and scientific fields, encouraging innovation in the economy as a whole.

The World Bank defines knowledge economies according to four pillars:

• Institutional structures that provide incentives for entrepreneurship and the use of knowledge
• Availability of skilled labor and a good education system
• Access to information and communication technology (ICT) infrastructures
• A vibrant innovation landscape that includes academia, the private sector, and civil society.

Example of a Knowledge Economy

Academic institutions, companies engaging in research and development (R&D), programmers developing new software and search engines for data, and health workers using digital data to improve treatments are all components of a knowledge economy.

These economy brokers pass on the results of their research to workers in more traditional fields, such as farmers who use software applications and digital solutions to manage their crops better, advanced technological-based medical procedures such as robot-assistant surgeries, or schools that provide digital study aids and online courses for students.

How Big Is the Knowledge Economy?

Because it is not a clearly-defined category such as manufacturing, it is difficult to put an exact price tag on the global knowledge economy. However, it is possible to gain a rough estimate by gauging some of the major components of the knowledge economy. In the United States, the total intellectual property market is worth $6.6 trillion, according to the U.S. Chamber of Commerce, and IP-intensive industries account for over a third of GDP. The market size of the country's higher education institutions accounts for an additional $568 billion.

What Are the Most Valuable Skills in the Knowledge Economy?

While higher education and technical training are obvious assets, communication and teamwork are also essential skills for a knowledge-based economy, according to the Organization for Economic Cooperation and Development . Since it is unlikely that any single knowledge worker can generate groundbreaking innovations alone, these interpersonal and workplace competencies are essential to surviving in a knowledge-based workplace.

Which Country Has the Biggest Knowledge Economy?

The factors of a knowledge economy are measured by the United Nations Development Program's Global Knowledge Index, which replaced the World Bank Knowledge Economy Index after 2012. This metric scores each country based on "enabling factors" for the knowledge economy, such as education levels, technical and vocational training, innovation, and communications technology. According to the latest issue, Switzerland is the top-ranked knowledge economy with a total score of 71.5%. The next two are Sweden and the United States with scores of 70.0 each.

GovTrack. " H.R. 6933 (96th): Government Patent Policy Act of 1980 ."

The World Bank. " The Knowledge Economy, The Kam Methodology, and World Bank Operations ," Pages 5-8.

Ibis World. " Colleges and Universities in the US ."

Global Innovation Policy Center. " Why Is IP Important ?"

OECD. " Competencies for the Knowledge Economy ," Page 1.

Knoema. " Global Knowledge Index ."

• Terms of Service
• Editorial Policy
• Privacy Policy
• Your Privacy Choices

Articles on Knowledge economy

Displaying all articles.

Encyclopedia Britannica once published a catalogue of humanity’s ‘102 Great Ideas’ – and it created more questions than answers

Mike Ryder , Lancaster University

Jobs deficit drives army of daily commuters out of Western Sydney

Phillip O'Neill , Western Sydney University

As big cities get even bigger, some residents are being left behind

Sajeda Tuli , University of Canberra and Shakil Bin Kashem , University of Illinois at Urbana-Champaign

Digital training can help supervisors lift PhD output

Jan Botha , Stellenbosch University ; Gabriele Vilyte , Stellenbosch University , and Miné de Klerk , Stellenbosch University

New creatives are remaking Canberra’s city centre, but at a social cost

Richard Hu , University of Canberra and Sajeda Tuli , University of Canberra

What it takes for Indonesia to create, share and use knowledge to grow its economy

Arnaldo Pellini , Tampere University

How the SKA telescope is boosting South Africa’s knowledge economy

Nishana Bhogal , University of Cape Town

Science in Africa: homegrown solutions and talent must come first

Alan Christoffels , University of the Western Cape

Why big projects like the Adani coal mine won’t transform regional Queensland

John Cole , University of Southern Queensland

Why openness, not technology alone, must be the heart of the digital economy

Rufus Pollock , University of Cambridge

The Knowledge City Index: Sydney takes top spot but Canberra punches above its weight

Lawrence Pratchett , University of Canberra ; Michael James Walsh , University of Canberra ; Richard Hu , University of Canberra , and Sajeda Tuli , University of Canberra

How access to knowledge can help universal health coverage become a reality

Stevan Bruijns , University of Cape Town

From ‘white flight’ to ‘bright flight’ – the looming risk for our growing cities

Jason Twill , University of Technology Sydney

When ‘innovation’ fails to fix our finances

Usman W. Chohan , UNSW Sydney

Queensland’s budget puts it back on track to be a smart state

Chris Salisbury , The University of Queensland

Budget week reveals an appetite for government but not to govern

Travers McLeod , The University of Melbourne

Measuring the value of science: it’s not always about the money

Rod Lamberts , Australian National University

The East-West Link is dead – a victory for 21st-century thinking

Peter Newman , Curtin University

African Americans place a great value in postsecondary education

Kinder Institute

Related Topics

• Cities & Policy
• Developing a knowledge economy
• Global perspectives
• Knowledge workers
• South Africa
• Tony Abbott
• Urban planning

Audience Development Coordinator (fixed-term maternity cover)

Data and Reporting Analyst

Lecturer (Hindi-Urdu)

Director, Defence and Security

Opportunities with the new CIEHF

Top contributors.

Fulbright Scholar, Institute for Governance and Policy Analysis, University of Canberra

Professor, University of Canberra

Pro Vice-Chancellor (Engagement), University of Southern Queensland

Honorary Fellow in the School of Social and Political Sciences, The University of Melbourne

Innovation Fellow and Senior Lecturer, School of Architecture, University of Technology Sydney

Professor, Centre for Research on Evaluation, Science and Technology (CREST), Stellenbosch University

Director, Centre for Western Sydney, Western Sydney University

Lecturer, The University of Queensland

Associate Professor in Social Sciences, University of Canberra

Economist, UNSW Sydney

Dean of Business, Government and Law, University of Canberra

Senior lecturer in the Division of Emergency Medicine, University of Cape Town

Member of EduKnow Research Group at the University of Tampere (Finland), Tampere University

Associate Fellow, University of Cambridge

Senior Lecturer: Entrepreneurship Stellenbosch Business School, University of Cape Town

• X (Twitter)
• Unfollow topic Follow topic

The Connectedness Knowledge from Investors’ Sentiments, Financial Crises, and Trade Policy: An Economic Perspective

• Mubeen Abdur Rehman
• Saeed Ahmad Sabir
• Haider Mahmood

Sustainable Poverty Reduction in Nigeria: Does Process Innovation Matter?

• Fisayo Fagbemi
• John Oluwasegun Ajibike

Is the Relationship Between Clean/Non-clean Energy Consumption and Economic Growth Time-Varying? Non-parametric Evidence for MENA Region

• Tarek Ghazouani

Managerial Time Orientation, Corporate Resource Allocation, and Firm Resilience

• Xiaolong Wang
• Yanmin Zhao

Immigration, Growth and Unemployment: Panel VAR Evidence From Ε.U. Countries

• Melina Dritsaki
• Chaido Dritsaki

Ownership Structure and Firm Performance: A Comprehensive Review and Empirical Analysis

• Sanjana Bhakar
• Priti Sharma
• Sanjiv Kumar

Exploring Knowledge Dynamics and Change Management in Diverse Corporate Entrepreneurship Ecosystems

• Xiaoxian Zhu

The Attitude and Intention to Purchase Halal Cosmetic Products: A Study of Muslim Consumers in Saudi Arabia

• Abdulwahab S. Shmailan
• Abdullah Abdulmohsen Alfalih

Digital Innovation and Urban Resilience: Lessons from the Yangtze River Delta Region

• Nengjie Pan

Corporation Participation in Poverty Alleviation: A Bibliometric Analysis and Content Review

Cultivation of College Students’ Legal Literacy Under Entrepreneurship from the Perspective of Sustainable Development

• Yuanyuan Xu

Cultivating Entrepreneurial Minds: Unleashing Potential in Pakistan’s Emerging Entrepreneurs Using Structural Equational Modeling

• Ahmad Bilal
• Shahzad Ali
• Sayyed Zaman Haider

Does Demographic Dividend Enhance Economic Complexity: the Mediating Effect of Human Capital, ICT, and Foreign Direct Investment

• Stéphane Mbiankeu Nguea

Unraveling Enterprise Persistent Innovation: Connotation, Research Context and Mechanism

Boundary-Spanning Knowledge Search and Absorptive Capacity in Cooperative Innovation: A Study on Non-Core Firms in the Context of Sustainable Development

• Dongping Yu
• Tongyue Zhao

Convergence and Contrast: An Investigation into the Psychological Attributes of Budding Entrepreneurs

• Parwinder Singh
• Ankita Mishra

Strategic Talent Development in the Knowledge Economy: A Comparative Analysis of Global Practices

Rpa as a challenge beyond technology: self-learning and attitude needed for successful rpa implementation in the workplace.

• José Andrés Gómez Gandía
• Sorin Gavrila Gavrila
• Maria Teresa del Val Núñez

Human Capital, Income Inequality and Energy Demand Nexus in sub-Sahara Africa: Insights from Asymmetric Approach

• Olufemi Gbenga Onatunji
• Olusola Joel Oyeleke
• Rasaki Stephen Dauda

Innovative Approaches to Assessing Urban Space Quality: A Multi-Source Big Data Perspective on Knowledge Dynamics

Knowledge Workers, Innovation Linkages and Knowledge Absorption: An Interactive Mechanism Study

• Zongjun Wang
• Maping Zhang

Radical Change and Dominant Character of Digital Transformation in Artificial Intelligence Entrepreneurship in Less Innovative Economies

• Rafael Palacios Bustamante
• Xochitl Margarita Cruz Pérez
• María del Pilar Escott-Mota

Beauty and Flexible Employment in the Digital Age: The Mediating Role of Social Capital

Entrepreneurship Development as a Tool for Employment Creation, Income Generation, and Poverty Reduction for the Youth and Women

• Abdijabbar Ismail Nor

Effects of People Equity and Entrepreneurial Orientation on Firm Performance: The Mediation Role of Social Capital

• Shabeeb Ahmad Gill
• Salem Handhal Al Marri

Navigating Environmental Governance in China’s Hog Sector: Unraveling the “Race to the Bottom” Phenomenon and Spatial Dynamics

Dynamic Relationship Between Social Factors and Poverty: A Panel Data Analysis of 23 Selected Developing Countries

• Syed Muhammad Muddassir Abbas Naqvi
• Iftikhar Yasin

Digital Integration and Entrepreneurial Success: Examining Causation and Effectuation in Rural South China

• Liebing Cao

Effects of Information and Communication Technologies on Structural Change in Sub-Saharan Africa

• Nzepang Fabrice
• Nguenda Anya Saturnin Bertrand
• Ntieche Adamou

How Digital Technology Reduces Carbon Emissions: From the Perspective of Green Innovation, Industry Upgrading, and Energy Transition

• Jiangang Huang

Connecting Human and Information Resources in the Generation of Competitive Advantage

• Sergio Camisón-Haba
• José Antonio Clemente-Almendros
• Tomás Gonzalez-Cruz

Barriers and Strategies for Digital Marketing and Smart Delivery in Urban Courier Companies in Developing Countries

• Efrain Boom-Cárcamo
• Schneyder Molina-Romero
• María del Mar Restrepo

Discussion on the Relationship Between Chinese Government’s Investment in Health Human Capital and Economic Growth

• Miyeseer Maimaituxun

Dynamic Innovation Collaboration Based on Complex Network Analysis: Evidence from the “Belt and Road” Initiative

• Kangjuan Lyu

Has Digital Financial Inclusion Curbed Carbon Emissions Intensity? Considering Technological Innovation and Green Consumption in China

Enterprise Innovation, Government Subsidies, and Bank Loans: an Empirical Analysis from the Science and Technology Innovation Board of China

• Yongmei Fang

Social Disengagements Among Retired Pensioners

• K. Arockiam

The Dynamics of Digitalization and Urban Development on the Growth of the Economy: A Panel Data Analysis

• Muhammad Noshab Hussain
• Shaohua Yang

Enhancing a Business Recommendation System: Leveraging Blockchain Technology with a Differentiated Scoring Incentive Mechanism

• Zhijian Lan

Knowledge Dynamics in Rural Tourism Supply Chains: Challenges, Innovations, and Cross-Sector Applications

• Wenming Liu
• Jingjing Li

Integration of Informatization and Industrialization and Corporate Innovation: Empirical Evidence from China

• Xinjian Huang

Nexus Between Life Expectancy, Education, Governance, and Carbon Emissions: Contextual Evidence from Carbon Neutrality Dream of the USA

• Suleman Sarwar
• Irum Shahzadi

The Role of Entrepreneurship in Changing the Employment Rate in the European Union

• Dimitrios Komninos
• Zacharias Dermatis
• Christos Papageorgiou

The Inheritance Imperative: A Game-Theoretic Analysis of Reverse Tacit Knowledge Transfer

• Yuhan Zhang

Balancing Innovation and Efficiency: The Impact of Mixed Ownership Reform on Total Factor Productivity in Monopolized and Competitive Industries

• Hongduo Yan

Unpacking Antecedents of Knowledge Management Success: A Key to Firm Performance in the Banking Sector

• Samuel Godadaw Ayinaddis

Addressing Wicked Problems (SDGs) Through Community Colleges: Leveraging Entrepreneurial Leadership for Economic Development Post-COVID

• Samantha Bryant Steidle
• Christopher Glass
• Dale A Henderson

Empowering Rural Revitalization: Unleashing the Potential of E-commerce for Sustainable Industrial Integration

• Yun’an Long

Exploring the Current Landscape of Primary School Physical Education Within the Framework of the New Curriculum Reform: A Quality Evaluation Model Perspective

• Chengquan Li

Communication as a Transmitter of Trust in Healthcare Network During Pandemic

• Agata Kocia

• Find a journal
• Publish with us
• Track your research

Grow Your Business

What is the knowledge economy (and why should you care), share this article.

It’s no secret that the economy has changed since the beginning of the pandemic. Closures of brick and mortar businesses, shifts to online work and education, and labour shortages have all contributed to a different world than pre-COVID. But with change comes new opportunities – especially for entrepreneurs. 

• What is the knowledge economy?

Where is the knowledge economy going?

• Course creators

Technology companies, agencies, and consultants

• How can you benefit from the knowledge economy?

What is the knowledge economy? 

T he knowledge economy is an economic system where the main commodity is knowledge, not physical goods . 

This means that instead of only placing value on buying and selling physical products (like shoes or cars), value is also placed on expertise, innovation, discovery, and any other intellectual capital (like IT support, branding, research, or consulting). 

The term “knowledge economy” has been around since the late 1950s, but started to become most prominent in the late 1980s to the early 2000s . This knowledge economy was primarily focused on research and technology, with an increased demand for science-based innovation.

One indicator of this emphasis on innovation was the growth of total patents granted by the United States Patent and Trademark Office (USPTO). In 1981 the USPTO granted 71,114 patents, compared to 187,053 in 2003. Most recently in 2021, 374,006 patents were granted, showing no sign of innovation slowing down into the present.  

 Today, the knowledge economy is a massive part of the overall global economy with millions of people employed in disciplines such as marketing, customer experience, engineering, design, and education – to name a few. Value is highly placed on intangible assets like brand recognition, software, and patented designs.  

The World Bank Institute outlines four pillars that must be present for the knowledge economy to thrive. 

1. Institutional structures that provide incentives for entrepreneurship and the use of knowledge

For example, the US government supports small business innovation through the Small Business Innovation Research program . This program supports entrepreneurship and research through monetary grants from $150,000 – $1,000,000. The goal of the program is to stimulate high-tech innovation and help the “United States gain entrepreneurial spirit as it meets its specific research and development needs.” 

2. Availability of skilled labor and a good education system

This could mean good universities and school systems, but this definition is changing. There are increasingly online learning options to acquire the necessary skills to join the knowledge economy. For example, creators such as Miss Excel on Thinkific, make learning in-demand skills such as Microsoft Excel accessible from anywhere in the world . 

3. An effective innovation system of firms, research centers, universities, consultants, and other organizations 

This could be any non-governmental organization that contributes to innovation, like research labs or think tanks. For example, the European Organization for Nuclear Research (CERN) houses 12,200 scientists from 70 countries and is the largest physics laboratory in the world. CERN contributes to innovation globally and created the world’s most powerful particle accelerator in 2018.  

4. Access to information and communication technology (ICT) infrastructures

One example that comes to mind here is Google . With Google, people have the means to answer any question at the tip of their fingers through phones, tablets, and computers. They also have the ability to communicate through chat and email. The internet and search engines make access to information infrastructures accessible worldwide. 

Currently, more than 70% of patenting and production of scientific and technical papers happens in developed countries. There is clearly a large disparity between developing and developed countries when it comes to the knowledge economy.

 But that doesn’t mean developing countries can’t profit from the knowledge economy. With the internet and a multitude of ways to learn and make money online, there is greater opportunity than ever. Entrepreneurs in developing countries can tap into global knowledge to bolster their own success. 

That isn’t to say industrial and agricultural economies are going anywhere. We still need cars, shoes, furniture, appliances, and more. And of course, we still need food. But tapping into the knowledge economy is a fantastic way for entrepreneurs to make money – and sometimes help others in the process. 

As information becomes more widely available the knowledge economy will keep growing, making this an optimal time to jump in and benefit. 

The knowledge economy in action 

So we’ve defined what the knowledge economy is, and where it might be headed. But who are knowledge entrepreneurs, and what are they doing?  

You’ve probably heard of the biggest companies that operate in the knowledge economy. We previously mentioned Google , but Amazon and Apple are also great examples. All of these companies leverage the knowledge economy to deliver exceptional innovation: from revolutionizing online shopping to virtual assistants Siri,  Alexa, and Google Home, to ebooks and digital reading. 

But, it’s pretty hard to relate to these massive companies where hundreds of thousands of people are working towards the corporation’s success and innovation. There are many smaller entrepreneurs and companies benefitting from the knowledge economy, and building their own success. Here are a few examples:

Course creators  

Tonya Rapley, founder of myfabfinance

Tonya created myfabfinance to teach financial concepts to millennials. She now has an award-winning blog and highly successful financial course masterclass – all stemming from her desire to share knowledge with others. She credits her success with establishing herself as the go-to subject matter expert for finance. Because she demonstrates clear understanding and expertise, her audience and customers place value on that expertise and knowledge as well. 

Suzana Somers, founder of BachelorData Academy

Suzana taught herself how to analyze data using the TV show The Bachelor . This fun project led to her creating an Instagram account to share her data analysis. Her account became so popular Suzana decided to launch a data analysis course on Thinkific to share her knowledge. Her course has been featured in publications like Vanity Fair, and she’s helped her students learn data visualization all without any formal training in the area. Because she positioned her knowledge in such a unique way students i mmediately saw the value and were willing to pay for it. 

These two entrepreneurs are far from the exception – millions of companies and individuals are finding success within the knowledge economy. Look at fitness studios and yoga instructors switching to teaching online, or photographers and creatives sharing their knowledge through courses and videos.

Part of the growth of knowledge entrepreneurship is the fact that it’s open to anyone; a knowledge entrepreneur doesn’t have to be an expert, a celebrity or have the backing of an established business. They simply have a skill, knowledge, or passion that they want to share as part of creating or scaling a business. – Greg Smith, Co-Founder & CEO, Thinkific

While we know creating online courses is an excellent way to cash in, there are other options too. 

Take a look at e-commerce company Shopify . They’ve created a one-stop-shop for selling online, much in the same  way Thinkific has created a one-stop-shop for teaching online . Much of Shopify’s success comes from their ability to anticipate customer needs and release features that meet them.

For example, Shopify’s customers needed help marketing their online shops, so Shopify released email marketing and Facebook Ad integrations to make that easier. The company has completely changed e-commerce. Their innovation and technology has made Shopify a market leader, showing the knowledge economy in action.  

Agencies that provide consulting, design, or marketing services are also participating in the knowledge economy by selling their expertise to businesses. This could mean anything from helping businesses refine their organizational processes, to designing logos, to creating whole marketing plans. 

Another clear example are tech startups that create apps or software. There is value placed on the coding and infrastructure that exists to create the software or application, as well as the brand and idea. These are all products of expertise and innovation – part of the knowledge economy. 

These examples are in no way the only options for participating in the knowledge economy. The possibilities are nearly endless when it comes to ways to capitalize. 

How you can benefit from the knowledge economy 

The knowledge economy benefits people worldwide. More value placed on knowledge = incentive to invent, create, and share knowledge. But how can you personally benefit from the knowledge economy? 

Well, it depends on what you want to do. 

Read more: Find Your Niche in 5 Simple Steps

A great first step is to assess what you’re interested in and what you’re already knowledgeable about. Good at writing? Sell your skills through a course, or by freelancing on Fiverr or Upwork . Good at cooking? Write an online cookbook, or create videos on how to cook. Maybe you know how to create software and want to teach others how to code, so you start a bootcamp, or you sell a patent to your latest planning software. 

Or maybe you’ve successfully run a marathon. There’s a market out there of people looking for tips and tricks on how to start running marathons. Perhaps you start a blog catering to them and monetize it , or maybe you start a running online community where people can ask you questions and help each other. 

You get the point. Once you assess what your skill and knowledge set is, you just have to monetize it. A proven first step to do that is creating an online course. 

Creating an online course with related products such as ebooks, live lessons, and memberships is a great way to break into the knowledge economy. If you know how to do something successfully, there’s an audience that’s willing to pay for the value your knowledge will bring them.

Why not try it out and join the knowledge economy? 

Maddie is a content marketer at Thinkific. When she isn't zealously writing about all things online learning, you can find her glued to a good book or exploring the great outdoors.

• How To Use Webinars To Promote Your Courses (Complete Guide)
• How to Create a Sales Funnel to Sell Online Courses (Sales Funnel Template)
• Udemy’s Pricing Model: How To Use It To Your Advantage As An Online Course Creator
• How to Build a Personal Brand (Complete Guide)

Related Articles

Building your personal brand & audience online (ani alexander interview).

Teach Online TV interview with podcast host & best-selling author Ani Alexander on how to build a strong personal brand and build your audience online.

The 3 Steps To Creating A Powerful Presentation (Julia Wojnar Interview)

Thinkific Teach Online TV interview with public speaking expert Julia Wojnar on the 3 steps to creating a powerful presentation.

How To Host Joint Venture Webinars to Sell More Online Courses

Hosting a webinar with a Joint Venture partner is an effective way to increase your online course sales. In this article, we show you how to do it.

Try Thinkific for yourself!

Accomplish your course creation and student success goals faster with thinkific..

Download this guide and start building your online program!

It is on its way to your inbox

Thank you for visiting nature.com. You are using a browser version with limited support for CSS. To obtain the best experience, we recommend you use a more up to date browser (or turn off compatibility mode in Internet Explorer). In the meantime, to ensure continued support, we are displaying the site without styles and JavaScript.

• View all journals
• My Account Login
• Explore content
• About the journal
• Publish with us
• Sign up for alerts
• Open access
• Published: 03 April 2024

Circular design strategies and economic sustainability of construction projects in china: the mediating role of organizational culture

• You Chen 1 ,
• Xiaomin Yin 2 &
• Chunwei Lyu 3  

Scientific Reports volume  14 , Article number:  7890 ( 2024 ) Cite this article

39 Accesses

Metrics details

• Energy science and technology
• Engineering

This research aims to elucidate the relationship between circular design strategies (CDS) and the economic sustainability of construction projects (ESCP), examining the mediating role of organizational culture (OC). Motivated by the imperative to develop a sustainable circular economy (CE) model in the building industry, our study focuses on a crucial dimension of CE processes. Specifically, we investigate how construction firms’ organizational values shape their pursuit of desired economic outcomes within CE theory. Through a comprehensive analysis of 359 responses from a cross-sectional survey of Chinese construction firms employing Partial Least Squares-Structural Equation Modeling (PLS-SEM), our findings reveal a positive albeit weakly impactful association between CDS and ESCP. Simultaneously, OC is identified as a factor detrimental to ESCP. Notably, this study unveils the influential roles of hierarchical culture (HC) and group culture (GC) in shaping the current state of ESCP in China. Emphasizing the significance of CDS, we propose that contract administrators proactively reposition their organizations to adopt strategies conducive to achieving the necessary economic output for construction projects. The originality aspect lies in this research contributes to the existing body of knowledge by offering empirical insights into the theoretical framework, marking the first such empirical study in northern China. We conclude by critically examining research outcomes and limitations while providing insightful recommendations for future research to foster sustainable construction practices in the Chinese context.

Similar content being viewed by others

Analysis of influencing factors for housing construction technology in Desakota Village and town communities in China

Zhixing Li, Xin He, … Yafei Zhao

Design-driven regional industry transformation and upgrading under the perspective of sustainable development

Lisi You, Tie Ji, … Lei Shi

Mechanism of attitude, subjective norms, and perceived behavioral control influence the green development behavior of construction enterprises

Xingwei Li, Jiachi Dai, … Qiong Shen

Introduction

Current and upcoming trends point to the necessity for a fundamental shift in how resources are used to avoid ecological breakdown and significant interruptions in production 1 . The rate at which the human population grows, accompanied by a growth in the population’s purchasing power, always results in the depletion of additional material resources. Yin et al 2 . discussed how the world’s population is quickly urbanizing, with a 70% urbanization rate expected by 2050. China, one of the fastest-urbanizing countries in Asia, today has nearly half its population living in urban areas 3 , signalling the need for more infrastructure 4 . Linear material use is depleting scarce resources and accumulating global waste problems 5 . Given the costs of extracting, refining, and creating materials, maximizing the material’s value is critical to ensuring that it is kept in circulation (in terms of function and service) for as long as possible. A material flow paradigm, in which the flows are inverse, is more likely to solve the dilemma of an unsustainable universal linear flow economy 6 . The idea of the circular economy (CE) is a growing method that is increasingly frequently explored to overcome the existing quandary of product lifecycles to achieve a more sustainable, workable economic structure. The already prevalent topic of sustainable development, which has captivated worldwide consciousness and execution, bolsters the circularity mentality 7 . Transitioning to a working CE rule necessitates a multi-level transformation that includes technical modernization, new business models, and, most crucially, unwavering stakeholder cooperation 8 .

Policymakers and other stakeholders have recently expressed an interest in developing a circular economy model in the building industry 9 . According to the UK Green Building Council (UKGBC, 2019), CE must be viewed as a commercial strategy, not only a sustainability consideration, if economic opportunities are to be achieved. The building sector consumes 40% of processed timber globally and accounts for 16% of total water energy, yielding 40% of all raw materials and 25% of all resources mined in industrialized countries 10 , 11 . This vital figure highlights the extent to which the building industry is involved in the environment. Construction materials are becoming increasingly scarce in many parts of the world. Shifting to CE and other sustainability-driven business models necessitates a significant transformation that affects the entire construction company and its employees. This shift necessitates creative solutions that replace present systems with ones that are more circular in nature. To identify strategies for organizations to regulate this disruptive transformation, it is necessary to start from within the organization to understand the challenges and barriers they face 12 . Firms’ initiatives to shift to CE are insufficient 9 , 13 . A CE’s essential concept must reach every level of any organization wanting to operate according to its standards for it to be fully implemented 14 . The globally recognized idea of Organizational Culture (OC) of these organizations is at the heart of this argument. The impact of OC on a company’s operations and production has been recognized in the literature for a while now 15 , 15 , 16 , 17 , 18 , 19 , 20 , 21 . Prior research has shown OC as a background element or social context that impacts a firm’s learning processes in acquiring and applying specialized knowledge 22 .

The construction industry is a pivotal sector in the global economy, especially in rapidly urbanizing nations like China 23 , 24 . As the industry evolves, an increasing emphasis is on integrating sustainable practices to mitigate its environmental impact and promote economic viability. This study delves into the nuanced interplay between Circular Design Strategies (CDS) and the Economic Sustainability of Construction Projects (ESCP) 9 , 25 , with a particular focus on the mediating role of OC in this dynamic. The concept of a circular economy, characterized by reduced waste and continual use of resources, offers a promising pathway to sustainability in the construction sector 22 , 26 . However, the transition to a circular economy involves adopting innovative design strategies and a fundamental shift in the organizational culture within construction firms 19 , 27 .

The primary objective of this research is to unravel the complexities of implementing Circular Design Strategies in the construction industry and their impact on the economic sustainability of projects. We aim to understand how organizational culture influences this relationship, potentially acting as a catalyst or a barrier. By examining the specific context of the Chinese construction industry, this research seeks to contribute valuable insights into how firms can navigate the transition towards a circular economy, highlighting the critical role of organizational values and practices in this transformative journey.

Specifically, the research questions are refined and consolidated into a cohesive inquiry: How do Circular Design Strategies influence the Economic Sustainability of Construction Projects in the Chinese construction industry, and to what extent does Organizational Culture mediate this relationship? This question encapsulates the essence of our investigation, aiming to provide a holistic understanding of the interdependencies between design strategies, economic sustainability, and the underlying organizational ethos within the construction industry in China.

Literature review

Organizational culture in china.

Organizational culture has been defined in various ways, capturing its essence as a set of shared values, beliefs, and assumptions within an organization 2 , 15 , which defined as a set of “values, beliefs and salient assumptions that members of organizations have in common” 3 , 16 , 17 , 18 , 28 , 29 . The earliest specific definition of OC is “a pattern of basic assumptions—invented, discovered, or developed by a given group as it learns to cope with its problems of external adoption and internal integration—that has worked well enough to be considered valid and, therefore, to be taught to new members as the correct way to perceive, think, and feel concerning those problems” 30 .

Organizational culture shapes an organization’s behaviour, practices, and outcomes. Examining corporate culture in China is particularly insightful given its unique historical, social, and economic context, deeply rooted in its rich history, Confucian philosophy, and rapid socio-economic transformations. While the general definition of organizational culture applies, the Chinese context adds cultural nuances, emphasizing collectivism, hierarchy, and the significance of relationships 15 , 16 . Understanding guanxi, the intricate network of personal connections is crucial for grasping the intricacies of organizational dynamics in China 2 , 16 .

The dimensions of organizational culture in China reflect a blend of traditional values and modern influences 4 , 7 , 25 . Collectivism, harmony, and a strong sense of social hierarchy are prominent cultural dimensions, aligning with Confucian principles 17 , 17 , 19 . The influence of these dimensions can be observed in workplace dynamics, decision-making processes, and the emphasis on group cohesion over individual achievement.

Measuring organizational culture in China requires culturally sensitive instruments. The Hofstede Cultural Dimensions Model, with dimensions such as power distance, individualism-collectivism, and uncertainty avoidance, has been adapted to assess organizational culture in the Chinese context 20 , 21 . Additionally, instruments like the Chinese Organizational Culture Assessment Instrument (COCAI) have been developed to capture the unique aspects of organizational culture in Chinese enterprises 15 , 16 , 19 .

Organizational culture significantly influences employee behaviour in Chinese organizations. The emphasis on harmony and group cohesion fosters a collaborative and team-oriented work environment 3 , 15 , 21 . Leadership is crucial, with leaders often embodying Confucian values of benevolence and moral integrity 9 . This cultural backdrop influences Chinese organizations’ communication styles, decision-making processes, and conflict-resolution approaches. That’s the justification for this research selected this aspect to shed light on the mediating role among circular design strategies and economic sustainability of construction projects.

The relationship between organizational culture and performance in China is complex. The emphasis on collective goals can enhance teamwork and employee engagement, positively impacting organizational outcomes 3 , 17 , 18 , 21 . However, challenges arise when traditional cultural values clash with the demands of a rapidly evolving business landscape, requiring organizations to navigate a delicate balance between tradition and modernity 7 , 31 .

Their unique cultural context influences innovation within Chinese organizations. While traditional values may emphasize stability and conformity, there is a growing recognition of the need for innovative thinking 32 , 33 , 34 , 35 , 36 . Companies in China are increasingly adopting a more flexible and open organizational culture to encourage creativity and adaptability 33 , 34 , 35 .

Navigating change within Chinese organizations requires understanding the cultural dynamics at play. The cultural preference for stability and respect for authority may challenge rapid organizational transformation 34 . Successful change initiatives often involve aligning corporate culture with innovation and global competitiveness goals, requiring leaders to manage cultural shifts 7 , 31 , 34 .

Generally, every existing organization has its distinct cultural characteristics. In this context, culture refers to how groups, including companies, interact internally and externally. As a result, the cultural coherence of a specific organization is determined by the sufficiency of the group’s artistic mission, strategies, and processes 37 . These cultural techniques are referred to as “macro dimensions,” which are characterized by the dynamic nature of organizations, in which numerous forces interact and impact one another and are thus sensitive to changes that may alter the structure of the organization 37 .

To effectively empirically analyze the effects of OC in line with the stated objectives, this study adopts the Competing Values Framework (CVF) model advanced by Quinn and his co-researchers in the eighties 38 , 36 , 37 , 41 . The CVF is the most recurrently engaged tool in theoretical and experimental studies relating OC to organizational performance 19 and, hence, the most suitable to address CE-related activities. The CVF reveals the multifaceted compositions of OC specifically relating to submission, drive, management, choices and efficacy in an organization 15 .

Additionally, in light of variables that affect Circular Design Strategies (CDS) and Economic Sustainability of Construction Projects in China in the literature review, consider including variables like technological innovation, government regulations, market demand for green building, and supply chain practices. These factors significantly impact the adoption and effectiveness of CDS in contributing to economic sustainability.

In terms of justification for selecting organizational culture as a research variable, it fundamentally shapes how strategies are interpreted, implemented, and integrated within a company’s operations 19 , 38 , 41 . The Competing Values Framework (CVF) provides a multidimensional model to assess organizational culture, making it a robust tool for understanding the cultural underpinnings that influence CDS adoption 39 . Organizational culture affects every aspect of CDS implementation, from decision-making processes to employee engagement and resource allocation. This focus is particularly relevant in the Chinese construction industry, where rapid development and unique cultural factors necessitate a deep understanding of how organizational culture can facilitate or hinder the transition to more sustainable and economically viable construction practices.

Circular design strategies

With the building industry consuming a significant quantity of finite resources, it is critical to use an appropriate structural strategy from the start (design), paying attention to the circularity and reusability of the different materials and components within it. Furthermore, it is critical to concentrate on the packaging that these components are wrapped in; this circularity-by-design approach is essential to creating a zero-waste circular economy in both production and consumption. If the construction industry is an example of how crucial steps of circularity can be achieved through design, then it is critical to plan for reuse and recovery 42 , 43 . This refers to determining if an existing structure could be entirely or partially reused and incorporated into the new design. Materials, components, packaging, and other items that can be reused, remanufactured, returned, or repurposed would be included in the design 44 . Design for flexibility and deconstruction is a vital feature here, with the goal of creating a process and a structured system that decreases the life of waste while simultaneously designing a model for reuse and repurposing. The flexibility option in design is a significant tool for promoting the adoption of a CE system in various businesses and sectors 45 . On the one hand, the sustainability and Circular Economy (CE) paradigms 46 enhanced awareness of natural resource scarcity among customers and providers. Manufacturers have been forced to change their business strategies to pursue this transformation 47 by detecting and avoiding associated 48 and exploring potential advantages 43 .

Economic sustainability of construction projects

Practices supporting long-term economic growth without negatively harming the community’s social, environmental, or cultural components are called “Economic Sustainability (ES)” 49 . Financial aspects in construction refer to all costs and benefits associated with construction-related functions, from the initial capital investment to operating gains and final return proceeds 23 , 50 . Clients and owners naturally prioritize these issues, especially when breakthroughs or technology are introduced into the sector. Apart from that, how CE adoption leads to ES, which reduces building lifespan maintenance costs, is also demonstrated 51 . They stated that ES is guaranteed when circular design techniques are used, as they promise profitability without compromising people’s demands. Standardization of circular design and construction approaches reduces costs by minimizing repeats while saving on long-term operational costs due to fewer repairs and replacements 52 . They also discovered that ES is reached due to the ease with which materials may be retrieved, lowering material End-of-Life (EoL) costs. ES is thought to be attained when a client receives a good return on their investment by using CE processes and maintaining the quality of the end goods using modular building approaches that reduce waste and increase productivity. Another point of view is that the local economy is bolstered by the development of jobs in recycling and repair procedures, assuring the economy’s long-term viability 53 . Overall, the client’s economy improves due to the lower cost of acquiring new materials, a more sophisticated and consistent product quality and reliable performance achieved through repetitive design and production of modular components 54 .

Hypothesis development

Circular design strategies and organisational culture.

As more businesses employ design thinking techniques to address organizational problems, the need to establish corporate cultures that support the effective use of these tools may become more significant 55 . At the same time, past research has shown that cultural changes usually happen in stages due to organizational life cycle elements, demographic shifts, and members’ exposure to broader societal or professional culture shifts 56 . When rapid changes in corporate values and assumptions are required (for example, in the case of firms adopting circular design strategies), the role of organizational leaders, supported by company-wide initiatives (for example, training, coaching, and role modelling), may be critical in overcoming corporate culture’s natural inertia 57 . Construction companies must build a culture that nurtures creativity and promotes innovation to succeed and “remain externally flexible.” Ismail 58 claims that “innovation will be fostered when culture and way of thinking mix to create new ideas” 59 . Employees will be motivated to take an active role in decision-making and share their innovative ideas with management to improve organizational performance if the company has a strong culture 60 . As such, the following hypotheses were formulated to examine the extent of the relationship between the independent variable (circular design strategies) and the mediating variable (the CVF of group, developmental, rational, and hierarchical cultures). For this section, four hypotheses were developed for the relationship between the IV and each of the dimensions of the MV. The hypotheses were grown, therefore, to assess the relationship based on the proposed research framework shown (Fig.  1 ).

Research conceptual and hypothetical framework.

Circular Design Strategies have a significant positive effect on Group Culture.

Circular Design Strategies have a significant positive effect on Development Culture.

Circular Design Strategies have a significant positive effect on Rational Culture.

Circular Design Strategies have a significant positive effect on Hierarchical Culture.

Circular design strategies and economic sustainability

Sustainable and flexible ideas are crucial characteristics of a good building design 57 ; architects are expected to design robust and long-lasting structures; otherwise, they are fundamentally untenable. The idea is to encourage architects to consider designs for reducing waste generation, as considering waste minimization measures before generating waste is less expensive. For instance, modular construction and design can reduce waste generation on construction sites because fabrication is carried out at factories where production is controllable, thereby improving the economic sustainability of construction 36 . Additionally, empirical evidence that aids in evaluating sustainable methods will tremendously assist clients and can pave the way for future sustainable products 61 . Hence, the following hypothesis was formulated to examine the extent of the relationship between the independent variable (circular design strategies) and the dependent variable (the Economic sustainability of construction projects). The hypothesis was developed, therefore, to assess the relationship based on the proposed research framework shown (Fig.  1 ).

Circular Design Strategies have a significant positive effect on Economic sustainability.

Organisational culture and economic sustainability

According to Isensee et al 62 ., firms that do well in sustainability have a distinct organizational culture. Construction firms are also part of the business sector, and focusing on sustainability can help them compete more effectively. Offering sustainable products and services allows segmentation and customization to satisfy specific needs 63 . There appears to be no single approach to explain how innovations will develop or how culture can be maintained in a building industry with such a diversified and multileveled nature. To be competitive, businesses must continuously develop fresh ideas to improve operations and become more inventive. This is critical for industries like construction as they migrate to more sustainable practices 64 .

Consequently, the following hypotheses were formulated to examine the extent of the relationship between the four dimensions of the MV (group, development, rational and hierarchical cultures) and the DV (ES of construction projects). For this section, four hypotheses were developed for the relationship between the dimensions of the MV (CVF of OC) and the DV (ES of construction projects). The hypotheses were grown, therefore, to assess the relationship based on the proposed research framework shown (Fig.  1 ).

Group Culture has a significant favourable influence on Economic Sustainability

Development Culture has a significant favourable influence on Economic Sustainability

Rational Culture has a significant favourable influence on Economic Sustainability

Hierarchical Culture has a significant favourable influence on Economic Sustainability

The mediating role of OC between CDS and ES

Based on those mentioned earlier, the following hypotheses were also formulated to examine the mediating effect of the four dimensions of the MV (group, development, rational and hierarchical cultures) between the IV (CDS) and the DV (ES of construction projects) in line with RQ4. For this section, four hypotheses were developed to assess the mediating relationship based on the proposed research framework shown (Fig.  1 ).

Group Culture mediates the relationship between CDS and Economic Sustainability of projects

Development Culture mediates the relationship between CDS and Economic Sustainability of projects

Rational Culture mediates the relationship between CDS and Economic Sustainability of projects

Hierarchical Culture mediates the relationship between CDS and Economic Sustainability of projects

Theoretical background

The circular economy idea underpins this research. The CE was first introduced in the 1970s by the Swiss architect and economist Walter Stahel, who recommended that materials be managed in a ‘closed loop’, thereby turning waste into resources. Stahel defined this as a ‘Cradle-to-Cradle’ system and the Linear model as Cradle-to-Grave 65 . The need to stretch out product life through restoration and remanufacture was also emphasized 66 , 67 , 68 , 69 . Consequently, the Cradle to Cradle method was designed by William McDonough (architect) and Michael Braungart (environmental chemist), who stated that it would facilitate ‘design for abundance’ 70 as a result of which they developed the Cradle-2-Cradle (C2C) benchmark to approve and endorse products that justify such standards 44 . CE has evolved and continues to gain traction 71 . The mutual instituting ideologies are based on more outstanding resource organization and waste minimization 71 , 71 , 73 .

Research framework

The current study is unique in that it examines the link between CDS and ESCP mediated by the competing values framework of OC governed by the Circular Economy theory. Figure  1 illustrates the hypothetical research framework proposed for the study.

Methodology

Statement: This study confirms that all methods were carried out per relevant guidelines and regulations. Wuhan University’s institutional and licensing committee approved all experimental protocols. Informed consent was obtained from all subjects and legal guardian(s).

Survey and data collection

For this study, the Positivist approach and Quantitative techniques were adopted as philosophy and design, respectively, to ascertain the mediating effects of OC on the relationship between CDS and ESCP in the Chinese construction industry. This is to effectively analyze the causal relations and demonstrate the level of direct and indirect relationships among all variables. Given the study’s predefined philosophy and design, a survey technique was used to satisfy the stated goals. As a result of the background and scope provided, the target population for this study was all contracting and consulting firms in the study area. Only northern China was considered for this study, and the reasons were not far-fetched. So far, the southern region of China has hosted many studies on CE implementation and processes 7 , 31 , 32 , 33 , 34 , leaving no clear indices on the subject matter for the northern part. The north area currently consists of three geopolitical zones: North-west, North-Central and North-East. Two provinces from each zone will be picked for the study for appropriate spread, with Shanxi and Qinghai Province representing the North-west, the Inner Mongolia and Hebei provinces representing the North-central zone and Heilongjiang and Jilin Province representing the North-east. These provinces were carefully chosen since they represent areas with a high tendency for construction-related activities.

The total research population is 1535 obtained from https://libguides.library.cityu.edu.hk/busChina/comp-dir (an online directory of registered firms in China, December 2023 version) because of a dearth of data on available construction entities in the industry. However, the population for the selected province was found to be 778 . This was rounded to 800 to attain a research sample 260 based on the Shanxi and Qinghai Province 1970 rule of thumb 74 . The study adopted the proportionate stratified random sampling technique for its suitability in ensuring adequate representation of respondent elements 75 . The data was collected for six months, from June 2019 until November 2023. E-mails and WeChat messages attached with an online link for Google Forms were sent to respondents to complete. Follow-up calls and gentle reminders were sent to research assistants via phone for quick responses and full cooperation. The questionnaires were accompanied by cover letters that included a brief description of the research and assurance of anonymity and confidentiality. In total, 550 survey questionnaires were distributed to Construction Contracting and Consulting Companies in Northern China, of which 390 were returned. Out of the returned questionnaires, 359 were used for data analysis. Data were obtained from Principal partners, Partners, Management staff, Project Managers and Regular staff of these organizations through the survey instruments. Table 1 highlights the statistics of questionnaires distributed, including return and response rates.

Measurements

The measurement for Design Strategies (9 items), Competing values framework of organizational culture (22 items) and Economic sustainability of construction projects (10 items) were adopted from the sources highlighted in Table 2 . A 5-point Likert scale was employed for the use of this study. The Likert scale for Design strategies adopted ranged from “very low”, denoted by 1, to “very high”, represented by 5. The Likert scale for Organizational culture ranged from “strongly disagree”, characterized by 1, to “strongly agree”, denoted by 5. The Likert scale for Economic sustainability indicators ranged from “very low”, indicated by 1, to “very high”, marked by. Additionally, the respondents were provided with descriptions for every construct, with precise directions on completing the assessment of the items to prevent any confusion. Table 2 demonstrates the constructs and variables used in this study.

Demographic profile

The demographic profile shows that respondents possessed adequate experience, education, and the correct position to respond to this study. Project managers accounted for 30% of the respondents, with the remaining percentage taken by Administrative staff (26%), Partners (10%), Principal staff (8%) and Project support staff (27%). Regarding professional background, Architects, Quantity Surveyors and Builders they have accounted for 85% of the respondents. About 62% of the respondent organizations (Contracting = 57%, Consulting = 43%) have operated for years ranging between 15 years and above. Regarding educational background, 60% of respondents possess a minimum master’s degree, and 38% have a bachelor’s degree. 86% of responding firms engage in Building projects, while 14% engage in Engineering projects.

In total, 550 survey questionnaires were distributed to Construction Contracting and Consulting Companies in Northern China, of which 390 were returned. For the returned questionnaires, 359 were deemed usable after being filtered for errors, incompleteness, or missing data, thus giving a response rate of 65%. Thirteen hypotheses were formulated and tested in this study. Data were obtained from Principal partners, Partners, Management staff, Project Managers and Regular staff of these organizations through survey questionnaires.

Data analysis

The PLS-SEM technique using SmartPLS 3.3.3 78 software was selected to examine the research model. PLS can handle complex structural equation models with many constructs and non-normal data distribution. Hence, this approach was used 79 . Table 3 portrays Mardia’s multivariate skewness (_β = 7.612, p  < 0.01) and kurtosis (β = 54.349, p  < 0.01). If the b value for multivariate skewness is more significant than ± 3 and the b value for multivariate kurtosis is more critical than ± 20, then the data distribution is not normal 80 . As a result, PLS-SEM was used as recommended by 81 .

Common method variance

Because self-report questionnaires gathered the data for this study, there is a risk of statistical and methodological biases developing because the data came from a single source and had similar scale qualities 82 . A comprehensive collinearity test is one of the methods used to detect this issue. If two or more variables measure the same attribute of an object or construct, they are said to be collinear 83 . To calculate the Variance Inflation Factor (VIF) values, linear regression analysis was used in SPSS Statistic 23 software with a random variable as the dependent variable and other latent variables as independent variables. The value of 3.3 was chosen 83 as the cut-off point for the VIF readings. CMV was not an issue and is unlikely to produce any problems for the current research findings because the VIF values (refer to Table 4 ) are below the threshold values.

Measurement model

The measurement model for this study was examined by checking the convergent and discriminant validity of the research data. The degree to which a measure correlates positively with other measures of the same construct is known as concurrent validity. The loadings, average variance extracted (AVE), and composite reliability (CR) were used to measure validity and reliability. The loadings of all the items must be more than 0.5, the average variance extracted (AVE) should be a minimum of 0.5, while the composite reliability (CR) needs to be above 0.7 for convergent validity to be attained 84 , 85 . As shown in Table 5 , all the AVE were more significant than 0.5, and the CR were greater than 0.7. However, some loadings were lower than 0.7. The measurement was shown to have convergent validity and reliability because the AVE and CR met the specified cut-off values 86 .

Next, discriminant validity was assessed by looking at the HTMT ratios. By empirical standards, discriminant validity refers to how distinct a construct is from others. If the ratios are less than HTMT 0.85 , it may be concluded that all measures are discriminant 87 . Also, if the upper limit of the HTMT bootstrapping value does not contain a 1, then the measurements are discriminant 88 . As shown in Table 6 , all the ratios are below a cut-off value of 0.85; as such, the measures are distinct.

Structural model

The structural model explains the hypothesized relationship between the constructs. To check the significance level, t-statistics for all paths were evaluated using a complete bootstrapping procedure with 5000 samples, a significance level of 5 percent, and a one-tailed test 86 . The findings for direct relationships are summarized in Table 7 ; revealing that DS is thus associated with GC (β = 0.357, t = 7.219), DC(β = 0.637, t = 20.775), RC(β = 0.269, t = 5.344), HC(β = − 0.316, t = 7.252) and ESCP(β = 0.246, t = 2.953). Also, DC with ESCP (β = − 0.063, t = 0.662), GC with ESCP (β = 0.115, t = 1.752), HC with ESCP (β = − 0.169, t = 2.510), RC with ESCP (β = − 0.096, t = 0.859). In addition, based on the critique of 89 that p -values are not a good criterion for assessing the significance of hypotheses, we employed a combination of parameters such as p -values, confidence intervals, and effect sizes. Table 7 shows the summary of the parameters we have used to test the hypotheses developed.

R 2 was analyzed to examine the amount of variance in the endogenous constructs explained by exogenous constructs 81 . The effect range is from 0 to 1, which assumes that the higher the value, the higher the predictive accuracy level 86 . This research used the rule of thumb developed, where 0.26 means substantial predictive accuracy, 0.13 means moderate predictive accuracy, and 0.02 means weak predictive accuracy. The R 2 values for GC, DC, RC, HC and ESCP are 0.127 (moderate), 0.406 (substantial), 0.072 (weak), 0.100 (weak) and 0.116 (weak), respectively (Refer to Fig.  2 ). Thus, the highest predictive accuracy of 41% of CDS can be explained by DC. To measure the effect size (f 2 ), the value of 0.02 is small, 0.15 is medium, and 0.35 is large 87 . As observed in Table, DC has no effect on ESCP(f 2  = 0.001), CDS has a negligible impact on ESCP (f 2  = 0.036), CDS has a little effect on RC(f 2  = 0.078) and HC(f 2  = 0.111), HC has a negligible impact on ESCP (f 2  = 0.027), CDS has a medium effect on GC(f 2  = 0.146), RC has no impact on ESCP(f 2  = 0.005), GC has no effect on ESCP(f 2  = 0.007), and CDS is having a significant impact on DC (f 2  = 0.683). The results above indicate that hypotheses H1, H2, H3, H5 and H6 are supported based on the parameters above. Based on the same criteria, H7 and H8 are not supported. The results also show that despite not having a value of 0 between the Confidence Intervals Bias adjusted at the Upper and Lower Limits 90 , hypotheses H4 and H9 are not supported due to negative beta values. As a result, all the hypotheses for direct relationships are supported except H4, H7, H8 and H9.

Outer loading, R2 and path coefficients.

Mediation analysis

To test the mediation hypotheses, this study followed the suggestions 81 , 91 by bootstrapping the indirect effect. It can be concluded that there is significant mediation if the confidence interval does not straddle a 0. As shown in Table 8 , CDS → GC → ESCP (β = 0.041, t = 1.713) and CDS → HC → ESCP (β = 0.053, t = 2.609) are significant, while CDS → DC → ESCP (β = − 0.040, t = 0.660) and CDS → RC → ESCP (β = − 0.026,t = 0.821) are not significant. Furthermore, the confidence intervals bias corrected 95% also showed intervals straddling a 0 for H11 and H12. Thus, H10 and H13 are supported, while H11 and H12 are not.

Predictive relevance Q 2

This measure is an indicator of the model’s predictive power or predictive relevance. When a PLS path model is predictively relevant, it can accurately forecast data not included in the model estimation. In the structural model, Q 2 values larger than zero for a specific reflective endogenous latent variable indicate the path model’s predictive relevance for a particular dependent construct. The Q 2 value is obtained using the blindfolding procedure, an iterative process that repeats until each data point has been omitted and the model re-estimated. For our model, this process was repeated 9 times. The blindfolding process is typically used on endogenous constructs with a reflecting measurement model specification and single-item endogenous constructs 81 . A Q 2 score greater than 0 indicates the model predicts a specific endogenous construct 86 . Values of 0 and lower, on the other hand, show a lack of predictive relevance.

Table 9 demonstrates that all endogenous variable items in the model had a Q 2 value greater than 0, indicating that the model has predictive potential and may be used to ascertain new cases.

Discussion and conclusion

This study provides a comprehensive analysis of the interplay between Circular Design Strategies (CDS), Organizational Culture (OC), and the Economic Sustainability of Construction Projects (ESCP) within the context of the Chinese construction industry. The findings corroborate previous literature and extend the understanding of these constructs and their interrelations, offering theoretical and practical implications.

The primary goal of this study is to look at the link between circular design strategies and construction projects’ economic sustainability, using organizational culture as a mediating factor (group, development, rational and hierarchical cultures). To the authors’ knowledge, this is the first empirical study in northern China that looks at this theoretical framework.

Theoretical contribution

Interplay between cds and escp.

The research demonstrates a significant, albeit nuanced, relationship between Circular Design Strategies and the Economic Sustainability of Construction Projects. This supports existing literature that underscores the importance of sustainable practices in enhancing the economic viability of construction projects 56 , 60 . However, the study goes further by quantifying the strength of this relationship, shedding light on the extent to which CDS directly influences ESCP in the Chinese construction sector.

Influence of Organizational Culture

The study reveals that Organizational Culture significantly mediates the relationship between CDS and ESCP. This finding aligns with the works 57 , 61 , highlighting the pivotal role of organizational values and practices in successfully implementing sustainable strategies. The study contributes to the literature by providing empirical evidence of the mediating role of OC, especially within the hierarchical and group culture dimensions, in the context of the Chinese construction industry.

The analysis of the relationship between CDS and ESCP in northern China based on the mediating role of the CVF of OC is the research’s critical theoretical contribution (group, development, rational and hierarchical cultures). The circularity attitude is bolstered by the widespread theme of sustainable development, which has grabbed global consciousness and execution. The relationship between CDS and ESCP is yet to be studied, as mentioned in the first section. Consequent to the research questions, objectives, and subsequent findings, the research has drawn essential conclusions.

The first research question sought to ascertain the relationship between CDS and ESCP. Based on the findings, the relationship was significant, as hypothesized, although with a small effect size (0.036). Their supported hypothesis agrees with the assertion 61 , while the small and weak effect can collaborate with the studies 25 , 26 who concluded that companies struggle to apply CE thoughts to construction. Another reason for the perceived weakness of the relationship might be the limited knowledge of respondents on circular practices and novel ideas such as CDS. The results for the second research question we set out to answer with H1-H4 reveal that all hypotheses except the relationship between CDS and HC are supported. This makes sense and agrees with the findings 35 , 92 , which reflect the hierarchical culture’s difficulty in accommodating new inventions in its stringent and highly controlled setting. In contrast, the strong relationship between CDS and DC highlights how DC incorporates innovative ideas into its fold, as concluded by 19 , 93 .

This study also revealed that the third research question addressed by H6-H9 was not supported except for the relationship between GC and ESCP. This contradicts previous research 94 , 95 that dwelled on the positive relationship between OC and ESCP. Regarding the effect of these cultures on sustaining construction economically, the hierarchical nature of firms plays a significant role, as highlighted in the results (0.027), as against development culture, which has a minor effect on the four cultures (0.001). This further validates the result from the second research question (H1–H4). The fourth research question sought to answer the mediating effect of OC on the relationship between CDS and ES. The result supports two hypotheses, H10 and H13, while H11 and H12 are not. The result confirms that the current low state of economic sustainability in the study area can be attributed to the two most prevalent culture types in construction firms: hierarchical culture (t = 2.609) and group culture (t = 1.713).

Aside from these findings, this study contributes to closing a gap in applying CDS and CE principles in a developing country like China. Most earlier studies had centred on larger organizations in advanced countries. As a result, this study adds to the current body of knowledge by studying and investigating the link between CDS and ESCP through the lens of OC in northern China. Finally, this study contributes practically as the predictive relevance Q 2 confirms that the model can predict new cases.

Practical implication

Strategic implementation of cds.

The positive relationship between CDS and ESCP underscores the importance of integrating circular design strategies in construction projects to enhance economic sustainability. Construction firms are encouraged to adopt such methods, ensuring that resource usage is optimized and waste is minimized, thereby contributing to environmental sustainability and enhancing the economic performance of construction projects.

Cultural reorientation for sustainability

The mediating role of Organizational Culture in the relationship between CDS and ESCP suggests that firms should foster a culture that supports sustainability initiatives. Particularly, firms with hierarchical and group cultures, which have been shown to have a significant mediating effect, should consider reorienting their cultural values to be more conducive to adopting circular design strategies. This may involve training programs, revising policy frameworks, and incentivizing sustainable practices among employees.

This paper also presents the Chinese construction industry with practical implications besides the theoretical contributions. The research conceptual framework and the output model can be used as a guide in the construction industry to assist contracting and consulting firms in understanding the impact of their respective organizational cultures in applying circular design ideologies for attaining the economic sustainability of their projects. Previous literature has highlighted these firms’ reluctance to engage these ideologies 25 , 26 , citing their organizational disposition as a probable reason for this shortcoming 12 , 27 . Using the model from this study, Partners, Administrators, Project managers and technical staff of these firms will be able to positively reposition their organizations to effectively adopt the appropriate strategy for attaining the much-required economic output for their projects. Administrators should strive to improve their knowledge of sustainable and circular practices to strengthen the relationship between CDS and ESCP.

Consequent to discovering the insignificant relationship between OC and ESCP in the study, firm administrators must spearhead an organizational paradigm shift from the current stringent culture to a more flexible and innovative culture to achieve the desired objective. This could be done simultaneously with investments in innovations, sustainable skills, and technology acquisitions to increase the economic performance of construction projects. When this is achieved, the state of the study variables, which HC and GC mediate, will improve and give way for the more flexible and innovative culture (DC) to mediate the relationship, thereby attaining ESCP in China.

Limitations of the study

Even though this study contributes to theory and practice, it has some limitations. To begin with, data collection is solely based on self-report questionnaires. Even though some scholars have questioned this method, it was deemed necessary due to the difficulty in independently assessing each construct. Furthermore, a comprehensive collinearity test was performed, and the VIF values demonstrated that CMV was not a concern in this study. Additionally, this study used cross-sectional data, which makes it impossible to assess ESCP before and after companies adopted the circular design concept. Hence, a longitudinal study is recommended, where more detailed findings can be imparted after adjustments are made. Also, this study was conducted entirely in China, emphasizing the country’s building industry in the north. Consequently, the conclusions cannot be applied to less developed or more developed countries or other sectors within the same country. Despite these limitations, the findings offer fresh insights into CDS and ESCP in the Chinese construction industry based on the mediating role of OC.

Directions for future research

Considering the limitations encountered for this study, it can be taken up and extended in other directions. Other circular economy processes apart from design (circular construction, material sustainability, etc.) can also be investigated to ascertain how OC or other organizational attributes can mediate or moderate their relationship with sustainability. Future research can also replicate this approach for different industries in the study area. It would also be interesting to see how these constructs relate to other dimensions of sustainability, both environmental and social.

Apart from that, future research could employ a longitudinal design to assess the impact of CDS and changes in OC on ESCP over time. Expanding the study to include other regions or industries could provide a more comprehensive understanding of these relationships.

This study meticulously explored the intricate relationship between Circular Design Strategies (CDS), Organizational Culture (OC), and the Economic Sustainability of Construction Projects (ESCP) within the Chinese construction industry. It aimed to understand the direct impact of circular design strategies on economic sustainability and how the fabric of organizational culture mediates this relationship. The findings unearthed the nuanced yet impactful nature of these interrelationships, offering insights into the potential of CDS in driving economic sustainability when effectively integrated with a supportive organizational culture.

Summary and impactful nature of results

The research confirmed that CDS positively influences ESCP, albeit the strength of this influence varies, underscoring the importance of sustainable design practices in enhancing the economic viability of construction projects. More profoundly, the study revealed that OC significantly mediates this relationship, particularly highlighting the roles of hierarchical and group cultures. These insights are crucial, pointing to the fact that organisational culture must be aligned for circular design strategies to be effectively translated into economic sustainability. This alignment ensures that sustainable practices are adopted and deeply embedded within the firm’s operations and values.

Consequential effects

The consequential effects of these findings are multifaceted. This study highlights the need for construction firms to foster a culture that supports innovation and sustainability. It calls for a strategic reorientation towards practices that drive economic benefits and contribute to a sustainable construction industry. For policymakers and stakeholders, the study underscores the importance of promoting policies and frameworks that encourage the adoption of circular design strategies and foster organizational cultures conducive to sustainability.

Limitations and directions for future research

While the study offers valuable insights, it acknowledges certain limitations. The use of cross-sectional data limits the ability to observe the evolution of these relationships over time. Additionally, the focus on the Chinese construction industry, while offering in-depth insights, may limit the generalizability of the findings to other contexts.

Future research should consider longitudinal studies to capture the dynamics of these relationships over time. Expanding the geographical scope to include other regions or conducting comparative studies between different construction industries could provide a broader understanding of these relationships. Additionally, future studies might explore the elements within organizational culture that most effectively support the adoption and implementation of circular design strategies.

Final thoughts

In conclusion, this study emphasizes the critical role of circular design strategies and organizational culture in driving the economic sustainability of construction projects. It offers a nuanced understanding of how these elements interplay within the Chinese construction industry, providing a foundation for future research and practice to foster a more sustainable construction industry. The findings serve as a call to action for firms and policymakers alike to champion practices and cultures that drive economic growth and contribute to a more sustainable and resilient construction industry.

In a nutshell, the main contribution of the present research is its proof concerning the positive effect of CDS on ESCP and the discovery of adverse effects of OC on ESCP in the Chinese construction industry. As a mediator, HC weakens the relationship between CDS and ESCP. This signals that firms need to develop and switch to a more innovative culture like the DC to drive circular practices and eventually contribute to the economic sustainability of construction projects in China.

Data availability

The data retrieved from https://libguides.library.cityu.edu.hk/busChina/comp-dir during the current study are available from the corresponding author upon reasonable request.

Abbreviations

Organisational culture

Circular economy

Partial least squares-structural equation modeling

Hierarchical culture

Group culture

UK green building council

• Economic sustainability

End-of-life

Competing values framework

Research question

Average variance extracted

Chen, H. M., Zhou, R. & Ulianov, C. Numerical prediction and corresponding circular economy approaches for resource optimisation and recovery of underground structures. Urban Rail Transit. 6 , 71–83 (2020).

Article   Google Scholar  

Yin, B. C. L., Laing, R., Leon, M. & Mabon, L. An evaluation of sustainable construction perceptions and practices in Singapore. Sustain. Cities Soc. 39 , 613–620 (2018).

Chen, Y. S. et al. Improving green product development performance from green vision and organizational culture perspectives. Corp. Soc. Responsib. Environ. Manag. 27 , 222–231 (2020).

Article   CAS   Google Scholar  

Isa, R. B., Jimoh, R. A. & Achuenu, E. An overview of the contribution of construction sector to sustainable development in Nigeria. Net J. Bus. Manag. 1 , 1–16 (2013).

Google Scholar  

Van Der Laan, Z. A. & Aurisicchio, M. Designing product-service systems to close resource loops: Circular design guidelines. Proc. CIRP 80 , 631–636 (2019).

Korhonen, J., Honkasalo, A. & Seppälä, J. Circular economy: The concept and its limitations. Ecol. Econ. 143 , 37–46 (2018).

Ezeudu, O. B. & Ezeudu, T. S. Implementation of circular economy principles in industrial solid waste management: Case studies from a developing economy (Nigeria). Recycling 4 , 42 (2019).

Witjes, S. & Lozano, R. Towards a more circular economy: Proposing a framework linking sustainable public procurement and sustainable business models. Resour. Conserv. Recycl. 112 , 37–44 (2016).

Mahpour, A. Prioritizing barriers to adopt circular economy in construction and demolition waste management. Resour. Conserv. Recycl. 134 , 216–227 (2018).

Alsanad, S. Awareness, drivers, actions, and barriers of sustainable construction in Kuwait. Proc. Eng. 118 , 969–983 (2015).

Ifije, O. & Aigbavboa, C. Identifying barriers of sustainable construction: A Nigerian case study. MATEC Web Conf. 312 , 04004 (2020).

Ritzén, S. & Sandström, G. Ö. Barriers to the circular economy—integration of perspectives and domains. Proc. CIRP 64 , 7–12 (2017).

Veleva, V., Bodkin, G. & Todorova, S. The need for better measurement and employee engagement to advance a circular economy: Lessons from Biogen’s “zero waste” journey. J. Clean. Prod. 154 , 517–529 (2017).

Laumann, F. & Tambo, T. Enterprise architecture for a facilitated transformation from a linear to a circular economy. Sustainability (Switzerland) 10 , 3882 (2018).

Zu, X., Robbins, T. L. & Fredendall, L. D. Mapping the critical links between organizational culture and TQM/Six Sigma practices. Int. J. Prod. Econ. 123 , 86–106 (2010).

Naranjo-Valencia, J. C., Jiménez-Jiménez, D. & Sanz-Valle, R. Innovation or imitation? The role of organizational culture. Manag. Decis. 49 , 55–72 (2011).

Al-Swidi, A. K. Total quality management, entrepreneurial orientation and organizational performance: The role of organizational culture. Afr. J. Bus. Manag. 6 , 4717–4727 (2012).

Valmohammadi, C. & Roshanzamir, S. The guidelines of improvement: Relations among organizational culture, TQM and performance. Int. J. Prod. Econ. 164 , 167–178 (2015).

Pakdil, F. & Leonard, K. M. The effect of organizational culture on implementing and sustaining lean processes. J. Manuf. Technol. Manag. 26 , 725–743 (2015).

Arditi, D., Nayak, S. & Damci, A. Effect of organizational culture on delay in construction. Int. J. Proj. Manag. 35 , 136–147 (2017).

McClellan, J. G. Organizational culture, discipline, and the politics of self: Transformation through responsive conversation. Int. J. Bus. Commun. https://doi.org/10.1177/2329488420927775 (2020).

Teräväinen, V., Junnonen, J. M. & Ali-Löytty, S. Organizational culture: Case of the finnish construction industry. Constr. Econ. Build. 18 , 48–69 (2018).

Gan, X., Zuo, J., Ye, K., Skitmore, M. & Xiong, B. Why sustainable construction? Why not? An owner’s perspective. Habitat Int. 47 , 61–68 (2015).

Ogunmakinde, O. E., Sher, W. & Maund, K. An assessment of material waste disposal methods in the Nigerian construction industry. Recycling 4 , 13 (2019).

Rahimian, F. P., Goulding, J., Akintoye, A. & Kolo, S. Review of Motivations, success factors, and barriers to the adoption of offsite manufacturing in Nigeria. Proc. Eng. 196 , 512–519 (2017).

Jones, P. & Comfort, D. The construction industry and the circular economy. Int. J. Manag. Cases 20 , 4–15 (2018).

Owolabi, J. D., Faleye, D., Eshofonie, E. E., Tunji-Olayeni, P. F. & Afolabi, A. O. Barriers and drivers of innovation in the Nigerian construction industry. Int. J. Mech. Eng. Technol. 10 , 334–339 (2019).

Valencia, J. C. N., Valle, R. S. & Jiménez, D. J. Organizational culture as determinant of product innovation. Eur. J. Innov. Manag. 13 , 466–480 (2010).

Elsbach, K. D. & Stigliani, I. Design thinking and organizational culture: A review and framework for future research. J. Manag. 44 , 2274–2306 (2018).

Schein, E. H. Organizational Culture and Leadership: A Dynamic View (Jossey-Bass Publishers, 1985).

Oyelola, O., Ajiboshin, I. & Okewole, J. 21th international trade fair of material & energy recovery and sustainable development, ECOMONDO. Procedia Environmental Science, Engineering and Management vol. 4, 143-148 (2017).

Aremu, S. A. et al. Circular economy Nigeria perspective. In Circular Economy Global Perspective 279–297 (Springer, 2019). https://doi.org/10.1007/978-981-15-1052-6_15 .

Chapter   Google Scholar  

Ogunsanwo, A. O. & Ayo-Balogun, A. O. Circular economy and entrepreneurship development in Nigeria. J. Emerg. Technol. Innov. Res. 6 , 140–147 (2019).

Ogunmakinde, O. E. Developing a Circular-Economy-Based Construction Waste Minimisation Framework for Nigeria A Thesis submitted in fulfilment of the requirements for the award of Doctor of Philosophy in Building. (2019).

Tian, M., Deng, P., Zhang, Y. & Salmador, M. P. How does culture influence innovation? A systematic literature review. Manag. Decis. 56 , 1088–1107. https://doi.org/10.1108/MD-05-2017-0462 (2018).

Wang, J., Li, Z. & Tam, V. W. Y. Identifying best design strategies for construction waste minimization. J. Clean. Prod. 92 , 237–247 (2015).

Paz, M. G. T., Fernandes, S. R. P., Carneiro, L. L. & Melo, E. A. A. Personal organizational well-being and quality of organizational life: The mediating role of organizational culture. Revista de Administracao Mackenzie 21 , eRAMD200122 (2020).

Quinn, R. E. & Rohrbaugh, J. A competing values approach to organizational effectiveness. Public Prod. Rev. 5 , 122 (1981).

Quinn, R. E. & Rohrbaugh, J. Spatial model of effectiveness criteria: Towards a competing values approach to organizational analysis. Manag. Sci. 29 , 363–377 (1983).

Quinn, R. E. & McGrath, M. R. The Transformation Of Organizational Cultures. In Organizational Culture 315–334 (Sage Publications, 1985).

Frost, P. J. & Kaiser, E. F. Beyond rational management: Mastering the paradoxes and competing demands of high performance. Acad. Manag. Rev. 14 , 462–465 (1989).

Akinade, O. O. et al. Design for deconstruction (DfD): Critical success factors for diverting end-of-life waste from landfills. Waste Manag. 60 , 3–13 (2017).

Article   PubMed   Google Scholar  

Sassanelli, C., Urbinati, A., Rosa, P., Chiaroni, D. & Terzi, S. Addressing circular economy through design for X approaches: A systematic literature review. Comput. Ind. 120 , 103245 (2020).

Andrews, D. The circular economy, design thinking and education for sustainability. Local Econ. 30 , 305–315 (2015).

Esposito, M., Tse, T. & Soufani, K. Introducing a circular economy: New thinking with new managerial and policy implications. California Manag. Rev. 60 , 5–19 (2018).

Ellen MacArthur Foundation. Towards the Circular Economy - Economic and Business Rationale for an Accelerated Transition . Ellen Macarthur foundation rethink the future (2020).

Bocken, N. M. P., de Pauw, I., Bakker, C. & van der Grinten, B. Product design and business model strategies for a circular economy. J. Ind. Prod. Eng. 33 , 308–320 (2016).

Pacheco, de J., et al. Overcoming barriers towards sustainable product-service systems in Small and Medium-sized enterprises: State of the art and a novel decision matrix. J. Clean. Prod. 222 , 903–921 (2019).

University of Mary Washington. Economic Sustainability|Office of Sustainability. https://sustainability.umw.edu https://sustainability.umw.edu/areas-of-sustainability/economic-sustainability/ (2020).

Tunji-Olayeni, P. F., Mosaku, T. O., Oyeyipo, O. O. & Afolabi, A. O. Sustainability strategies in the construction industry: Implications on Green Growth in Nigeria. Proc. IOP Conference Series: Earth and Environmental Science 146 , (2018).

Kibwami, N. & Tutesigensi, A. Enhancing sustainable construction in the building sector in Uganda. Habitat Int. 57 , 64–73 (2016).

Kamali, M. & Hewage, K. Development of performance criteria for sustainability evaluation of modular versus conventional construction methods. J. Clean. Prod. 142 , 3592–3606 (2017).

Durdyev, S., Edmundas, Z., Thurnell, D., Banaitis, A. & Ihtiyar, A. Sustainable construction industry in Cambodia: Awareness, drivers and barriers. Sustainability (Switzerland) 10 , 1–19 (2018).

UKGBC. Circular Economy Guidance for Construction Clients : How to Practically Apply Circular Economy . (2019).

Buchanan, R. Worlds in the making: Design, management, and the reform of organizational culture. She Ji 1 , 5–21 (2015).

Elsbach, K. D. & Stigliani, I. Design thinking and organizational culture: A review and framework for future research. J. Manag. 44 (6), 2274–2306 (2018).

Canato, A., Ravasi, D. & Phillips, N. Coerced practice implementation in cases of low cultural fit: Cultural change and practice adaptation during the implementation of six sigma at 3M. Acad. Manag. J. 56 , 1724–1753 (2013).

Ismail, T. Culture control, capability and performance: Evidence from creative industries in Indonesia. Asian Rev. Account. 24 , 171–184 (2016).

Ali Taha, V., Sirková, M. & Ferencová, M. Wpływ kultury organizacyjnej na kreatywność i innowacje Polish. J. Manag. Stud. 14 (7), 17 (2016).

Shahzad, F., Xiu, G. Y. & Shahbaz, M. Organizational culture and innovation performance in Pakistan’s software industry. Technol. Soc. 51 , 66–73 (2017).

Zadeh, R. S., Xuan, X. & Shepley, M. M. Sustainable healthcare design: Existing challenges and future directions for an environmental, economic, and social approach to sustainability. Facilities 34 , 264–288 (2016).

Isensee, C., Teuteberg, F., Griese, K. M. & Topi, C. The relationship between organizational culture, sustainability, and digitalization in SMEs: A systematic review. J. Clean. Prod. https://doi.org/10.1016/j.jclepro.2020.122944 (2020).

Baumgartner, R. J. & Rauter, R. Strategic perspectives of corporate sustainability management to develop a sustainable organization. J. Clean. Prod. 140 , 81–92 (2017).

Matinaro, V. & Liu, Y. Towards increased innovativeness and sustainability through organizational culture: A case study of a Finnish construction business. J. Clean. Prod. 142 , 3184–3193 (2017).

Giarini, O. & Stahel, W. R. The Limits to Certainty. International Studies in the Service Economy Vol. 4 (Springer, 1993).

Stahel, W. Jobs for Tomorrow. New York, NY: Vantage.—Google Scholar. https://scholar.google.com/scholar?hl=en&as_sdt=0%2C5&q=Stahel+WR+%281981%29+Jobs+for+Tomorrow.+New+York%2C+NY%3A+Vantage.&btnG = (1981).

Stahel, W. R. The Performance Economy: Business Models for the Functional Service Economy. In Handbook of Performability Engineering 127–138 (Springer, 2008). https://doi.org/10.1007/978-1-84800-131-2_10 .

Stahel, W. R. History of the circular economy. The historic development of circularity and the circular economy. in The Circular Economy in the European Union 7–19 (2020). https://doi.org/10.1007/978-3-030-50239-3_2 .

Stahel, W. R. The business angle of a circular economy–higher competitiveness, higher resource security and material efficiency. Emf 1 , 11–32 (2012).

McDonough, W., & Braungart, M. Cradle to cradle: Remaking the way we make things. https://scholar.google.com/scholar?hl=en&as_sdt=0%2C5&q=McDonough+W+and+Braungart+M+%282002%29+Cradle+to+Cradle%3A+Remaking+the+Way+We+Make+Things.+New+York%2C+NY%3A+North+Point+Press.&btnG (2002).

Geissdoerfer, M., Savaget, P., Bocken, N. M. P. & Hultink, E. J. The circular economy – a new sustainability paradigm?. J. Clean. Prod. 143 , 757–768 (2017).

Sanchez, B. & Haas, C. Capital project planning for a circular economy. Constr. Manag. Econ. 36 , 303–312 (2018).

Pomponi, F. & Moncaster, A. Circular economy for the built environment: A research framework. J. Clean. Prod. 143 , 710–718 (2017).

Sekaran, U. & Bougie, R. Research Methods for Business A Skill-Building Approach (Wiley, 2016). https://doi.org/10.1007/978-94-007-0753-5_102084 .

Book   Google Scholar  

Gambo, N. Relationship between cost factors and performance of small scale local government contractors in Nigeria. (USM, 2016).

Bakker, C. & den Hollander, M. Six design strategies for longer lasting products in circular economy New opportunities. The Guardian 3–5 (2013).

De los Rios, I. C. & Charnley, F. J. S. Skills and capabilities for a sustainable and circular economy: The changing role of design. J. Clean. Prod. 160 , 109–122 (2017).

Ringle, C. M., Wende, S. & Becker, J.-M. SmartPLS 3. Boenningstedt: SmartPLS GmbH. https://scholar.google.com/scholar?hl=en&as_sdt=0%2C5&q=Ringle%2C+C.+M.%2C+Wende%2C+S.%2C+and+Becker%2C+J.-M.+2015.+%22SmartPLS+3.%22+Boenningstedt%3A+SmartPLS+GmbH%2C+http%3A%2F%2Fwww.smartpls.com.&btnG = (2015).

Urbach, N. & Ahlemann, F. Structural equation modeling in information systems research using partial least squares. J. Inf. Technol. Theory Appl. 11 , 5–40 (2010).

Kline, R. B. Principles and Practice of Structural..— Google Scholar . (2005).

Hair, J. F., Hult, G. T. M., Ringle, C. M. & Sarstedt, M. A. A Primer on Partial Least Squares Structural Equation Modeling (PLS-SEM) Vol. 38 (SAGE, 2017).

Podsakoff, P. M., MacKenzie, S. B., Lee, J. Y. & Podsakoff, N. P. Common method biases in behavioral research: A critical review of the literature and recommended remedies. J. Appl. Psychol. 88 , 879–903. https://doi.org/10.1037/0021-9010.88.5.879 (2003).

Kock, N. & Lynn, G. S. Lateral collinearity and misleading results in variance-based SEM: An illustration and recommendations. J. Assoc. Inf Syst. 13 , 546–580 (2012).

Hair, J. F., Howard, M. C. & Nitzl, C. Assessing measurement model quality in PLS-SEM using confirmatory composite analysis. J. Bus. Res. 109 , 101–110 (2020).

Hair, J. F., Risher, J. J., Sarstedt, M. & Ringle, C. M. When to use and how to report the results of PLS-SEM. Eur. Bus. Rev. 31 , 2–24. https://doi.org/10.1108/EBR-11-2018-0203 (2019).

Ramayah, T., Cheah, J., Chuah, F., Ting, H. & Memon, M. Partial least squares structural equation modeling (PLS-SEM) using smartPLS 3.0. (2018).

Henseler, J., Ringle, C. M. & Sarstedt, M. A new criterion for assessing discriminant validity in variance-based structural equation modeling. J. Acad. Mark. Sci. 43 , 115–135 (2015).

Franke, G. & Sarstedt, M. Heuristics versus statistics in discriminant validity testing: A comparison of four procedures. Internet Res. 29 , 430–447 (2019).

Hahn, E. D. & Ang, S. H. From the editors: New directions in the reporting of statistical results in the Journal of World Business. Journal of World Business vol. 52 125–126 Preprint at https://doi.org/10.1016/j.jwb.2016.12.003 (2017).

Nor-Aishah, H., Ahmad, N. H. & Thurasamy, R. Entrepreneurial leadership and sustainable performance of manufacturing SMEs in Malaysia: The contingent role of entrepreneurial bricolage. Sustainability (Switzerland) 12 , 3100 (2020).

Preacher, K. J. & Hayes, A. F. Asymptotic and resampling strategies for assessing and comparing indirect effects in multiple mediator models. Behav. Res. Methods 40 , 879–891 (2008).

Büschgens, T., Bausch, A. & Balkin, D. B. Organizational culture and innovation: A meta-analytic review. J. Prod. Innov. Manag. 30 , 763–781. https://doi.org/10.1111/jpim.12021 (2013).

Patyal, V. S., Ambekar, S. & Prakash, A. Organizational culture and total quality management practices in Indian construction industry. Int. J. Prod. Perform. Manag. 69 , 895–913 (2019).

Isensee, C., Teuteberg, F., Griese, K. M. & Topi, C. The relationship between organizational culture, sustainability, and digitalization in SMEs: A systematic review. J. Clean. Prod. 275 , 122944 (2020).

Srisathan, W. A., Ketkaew, C. & Naruetharadhol, P. The intervention of organizational sustainability in the effect of organizational culture on open innovation performance: A case of Thai and Chinese SMEs. Cogent Bus. Manag. 7 , 1717408 (2020).

Download references

Author information

Authors and affiliations.

Department of Architecture, Wuhan University, Wuhan, 430072, China

School of Marxism, Zhejiang Shuren University, Hangzhou, 310015, Zhejiang, China

Xiaomin Yin

School of Educational Studies, Universiti Sains Malaysia, 11700, Gelugor, Penang, Malaysia

Chunwei Lyu

You can also search for this author in PubMed   Google Scholar

Contributions

Y.C. wrote the main manuscript text and X.M.Y. prepared figures and tables. C.W.L. reviewed the manuscript.

Corresponding author

Correspondence to Xiaomin Yin .

Ethics declarations

Competing interests.

The authors declare no competing interests.

Additional information

Publisher's note.

Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.

Rights and permissions

Open Access This article is licensed under a Creative Commons Attribution 4.0 International License, which permits use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons licence, and indicate if changes were made. The images or other third party material in this article are included in the article's Creative Commons licence, unless indicated otherwise in a credit line to the material. If material is not included in the article's Creative Commons licence and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder. To view a copy of this licence, visit http://creativecommons.org/licenses/by/4.0/ .

Reprints and permissions

About this article

Cite this article.

Chen, Y., Yin, X. & Lyu, C. Circular design strategies and economic sustainability of construction projects in china: the mediating role of organizational culture. Sci Rep 14 , 7890 (2024). https://doi.org/10.1038/s41598-024-56452-0

Download citation

Received : 23 December 2023

Accepted : 06 March 2024

Published : 03 April 2024

DOI : https://doi.org/10.1038/s41598-024-56452-0

Share this article

Anyone you share the following link with will be able to read this content:

Sorry, a shareable link is not currently available for this article.

Provided by the Springer Nature SharedIt content-sharing initiative

• Circular design
• Organizational culture
• Construction projects

By submitting a comment you agree to abide by our Terms and Community Guidelines . If you find something abusive or that does not comply with our terms or guidelines please flag it as inappropriate.

Quick links

• Explore articles by subject
• Guide to authors
• Editorial policies

Sign up for the Nature Briefing newsletter — what matters in science, free to your inbox daily.

Creating Markets in Mauritius: Increasing Private Sector Participation in an Innovation-Led Economy

DOWNLOAD: FULL REPORT (PDF) | SUMMARY (PDF)

Mauritius has achieved remarkable success in overcoming the challenges commonly faced by small island states. Over the past 50 years, the country has undergone a significant transformation, transitioning from a low-income agriculture-based economy to a diverse upper-middle-income economy. In the past decade however, Mauritius has encountered challenges that have impacted its long-term growth model. The COVID-19 pandemic has further exposed long-standing structural issues in key sectors and has shed light on gender and youth disparities in labor force participation.

The Mauritius Country Private Sector Diagnostic (CPSD) offers an overview of the challenges and opportunities to further private sector growth in the country. The CPSD notes that the island-nation can build on its strengths to increase investments and diversify into more knowledge-intensive activities while expanding the economic participation of women and youth. The CPSD highlights education, renewable energy, and healthcare as sectors with potential for higher value-added growth and provides actionable recommendations and proposes short- and medium-term policy actions that can have a significant impact on development. The report also explores how innovation can be crucial in helping Mauritius to transition to a new development model. It highlights the need to develop a national innovation strategy that provides clear priorities and promotes research, and knowledge generation and transfer.

The report further notes Mauritius’ potential to become a regional hub for education and health and provides concrete recommendations. In education, the report recommends Mauritius enhance the student experience and promote public-private partnerships to attract more students and investments. In healthcare, the report recommends creating an action plan and developing a legal, policy, and regulatory framework to support Mauritius’ vision of becoming a regional medical hub. Finally, in renewable energy, the CPSD recommends Mauritius continue to strengthen the dialogue with the private sector to promote the implementation of the Renewable Energy Roadmap 2030. This dialogue should include the terms of power purchase agreements and tender processes to encourage private sector investments in wind, solar, and biomass projects. 

The World Bank in Mauritius

This site uses cookies to optimize functionality and give you the best possible experience. If you continue to navigate this website beyond this page, cookies will be placed on your browser. To learn more about cookies, click here .

• The Graduate School >
• Graduate News >

Share your best practice at the EU Knowledge Valorisation Talks 2024!

Have you tested a practice which is transforming knowledge and research results into practical solutions creating societal and/or economic value? Could your practice inspire other knowledge valorisation actors and be replicated by them? We would like to invite you to share your practice.

The Directorate-General for Research and Innovation of the European Commission is organising a series of EU Knowledge Valorisation Talks throughout 2024 to showcase inspiring practices and exchange experience among valorisation actors from all over Europe.

We are currently preparing online Talks on valorisation practices related to artificial intelligence (AI), research security and social sciences and humanities (SSH), as detailed further below.

Have you developed a specific successful way to turn knowledge into economic or societal value in one of these areas? Tell us about it!

AI and other digital techs: a revolution in knowledge valorisation?

Thursday 27 June 2024 (from 13:00 to 13:30/45)

Artificial intelligence and other digital technologies are changing the way we manage our scientific knowledge and make it available for everyday use - whether in business, public administration, education or other areas of public life. From results scouting to patent drafting and AI-assisted inventorship, the interplay between AI and intellectual assets management is ever-growing. We are looking for successful practices for the use of AI and other digital tools for knowledge valorisation. What digital strategies and tools have you developed and are you currently using them to analyse research results and scientific knowledge more quickly and effectively for their economic potential and to make them usable for deployment? What principles and guidance have you set up to ensure a responsible and sustainable application of these AI/digital tools for knowledge valorisation?

Research security: dealing with risk in intellectual assets management

Tuesday 24 September 2024 (from 13:00 to 13:30/45)

Co-creation and interlinkages between all actors in the R&I ecosystem are essential to derive more value from knowledge. However, international R&I collaborations can present risks related to potentially undesirable transfer and end-use of intellectual assets, malign influence and ethical or integrity violations. We are looking for successful practices on responsible intellectual assets management which balance openness and protection to address research security concerns in international collaborations. What strategies, tools or guidance has your organisation developed to identify, assess and mitigate potential research security risks linked to intellectual assets developed in international collaborations? What type of support does it provide to researchers, their teams and anybody concerned? How does your organisation raise awareness about research security concerns?  

Social Sciences and Humanities: untapped potential for innovative solutions and better policies

Tuesday 19 November 2024 (from 13:00 to 13:30/45)

Social Sciences and Humanities (SSH) are often overlooked in efforts of research results valorisation despite their great potential. Have you set up practices to support creating a start-up or spin-off based on SSH research? What measures and tools have you applied to make sure that SSH findings have been taken up in designing practical solutions and developing policies (on local, regional, national level) or perhaps a standard? By sharing your best practice, you can help stimulate the valorisation of SSH research and open possibilities to connect to peers.

Please express your interest by submitting a short description of your best practice to the repository on the EU Knowledge Valorisation Platform.

Submit your best practice

We also encourage you to submit, via this survey, a short video explaining your best practice.

Deadline for submissions is 10 May 2024 .

The selection of best practices will take into account a number of aspects ,

The three Talks will be online events of 30/45 minutes each. The owners of selected best practices will be invited to make a live presentation in Brussels at the studio of the Directorate-General for Research and Innovation of the European Commission.

This series of Talks replaces the EU Knowledge Valorisation Week in an attempt to adapt the format to more regular exchanges. If the new format proves to be successful, a new round of Talks will be organised subsequently.

More information

Share this page

An official website of the United States government

The .gov means it’s official. Federal government websites often end in .gov or .mil. Before sharing sensitive information, make sure you’re on a federal government site.

The site is secure. The https:// ensures that you are connecting to the official website and that any information you provide is encrypted and transmitted securely.

• Publications
• Account settings

Preview improvements coming to the PMC website in October 2024. Learn More or Try it out now .

• Advanced Search
• Journal List
• Springer Nature - PMC COVID-19 Collection

A Critical Review of the Precursors of the Knowledge Economy and Their Contemporary Research: Implications for the Computerized New Economy

Kwee keong choong.

1 Apt Visionary & Innovation, Melbourne, Australia

Patrick W. Leung

2 Department of Accounting, The Hong Kong University of Science and Technology, Clear Water Bay, Hong Kong SAR, China

Despite nearly fifty-eight years since the term knowledge economy first appears, we are getting nearer in understanding this new kind of economy. The purpose of this paper is to clarify the meaning of the knowledge economy by conducting a critical review of the precursors of the knowledge economy and their major critiques so as to identify the current research implications. We aim to identify common ground in advancing the research of the knowledge economy. In essence, our understanding of the knowledge economy is viewed from a ‘new’ social-economic-theoretical perspective in which the theoretical foundation focuses on the explosion of technology that motivates people to be innovative and possess knowledge in producing knowledge products or be so engrossed with sociability using technology at home. Our finding is that the notion of the knowledge economy must be viewed from some phenomena that have transformed the contemporary economy. Other major findings include the following: (1) we use the term knowledge economy instead of the multiplicity of terms to describe this new form of economy; (2) we articulate that the theoretical foundation of the knowledge economy is a branch of social economy where the economy is not based solely on production and consumption but is based more on social values, technology, knowledge and innovation to commercialize knowledge products; and (3) the statistical assessment methodology is delivered through the use of indicators to proxy for the four knowledge economy criteria that makes up the knowledge economy. This has the following implications for economic management, knowledge-induced innovation, computerization of the economy, and knowledge management in the new economy.

Introduction

The field of the knowledge economy is receiving tremendous interest. Isenberg ( 2010 ) reported that there were 40,000 articles on the knowledge and knowledge-based economies as at 2010 and there is a multiplicity of terms being used to describe similar concepts related to knowledge management (Davenport, 2005 ; Nonaka & Takeuchi, 1995 ), knowledge economy (Drucker, 1969 ; 1973 , 1999 ), knowledge industry (Machlup, 1962 ; Machlup & Mansfield, 1970 ), information economy (Porat, 1977 ; Porat & Rubin, 1977 ) and network society (Castells, 1997 ; Van Dijk, 1999 ,  2006 ). In view of the hefty of terms used, they can collectively be labelled as the knowledge economy (KE), and their authors are avowed as the precursors of the KE. However, nearly 58 years since Machlup’s seminal work on the KE, we are now getting nearer in understanding this new kind of economy. Initially, significant doubts arise as to whether the ‘modern economies’ are, indeed, ‘knowledge economies’. More critically, the current economic meltdown and the Covid-19 pandemic of these so-called knowledge economies are testimonies of false assertion by the precursors of the field, and most recently, the current medical pandemic has cast further doubt on the sustainability that the developed economies are knowledge economy. Such inadequacy occurs in view of the fact that the field has no shortage of writers and critics that advance or reject various avenues of the knowledge economy. So, what actually is ‘knowledge economy’?

The objective of this paper is to understand by questioning and reasoning by what the precursors meant by ‘knowledge economy’ and not on what they have explained in a casual manner. We also want to know whether similar terms like ‘knowledge-based economy’, ‘information economy’ or ‘knowledge society’ meant the same or different things, and even if they were used merely for semantic reasons, is there a common ground for us to specify a research agenda that enables us in the furtherance of the study of the field in a systematic manner? The objective is also to find the implications for economic management, computerization of the economy and knowledge management in the new economy. Therefore, this paper will make a contribution to the literature in the areas of the theory and management of the knowledge economy as it provides a new perspective of the issues in the emergence and operation of the knowledge economy, providing a better understanding of the computerized new economy.

In doing the above, we use a methodology comprising a systematic review, content analysis and critical theory (analysis) in helping us to examine the terms and contents used to describe a knowledge economy. The next section examines what the precursors of the knowledge economy have told us. In ‘ Commentary of the Precursors of the Knowledge Economy ’, we critically review what the critics of the precursors have told us, and explain what is wrong with the current reality of the knowledge economy. ‘ Theoretical consideration in advancing the research on the knowledge economy ’ is concerned with avenues in advancing the research of the knowledge economy. ‘ Conclusions and Discussion ’ reports the findings of the paper and their implications and concludes our discussion of this research.

Methodology

A systematic review of the literature.

According to Godin ( 2010 ), the works of the precursors of the knowledge economy can be divided into two waves of studies pertaining to the field. The works of Machlup, Mansfield, Drucker, Bell, Porat and Rubin are considered the first wave of studies on the knowledge economy, and the second wave started in the mid-1990s that revitalizes the studies in the first wave with a change in emphasis and continues today. The notable works of this second wave are Nonaka, Takeuchi, von Krogh, Davenport, Prusak and Volpel, Van Dijk, Castells, United Nations (UN), United Nations Educational, Scientific and Cultural Organizations (UNESCO) and the Organization for Economic Cooperation Development (OECD). Although the works of the UN, UNESCO and the OECD are not really seminal, aspects of their works have merits and, hence, can be considered as precursors of the second wave. This assertion by Godin ( 2010 ) is consistent to the Handbook on the Knowledge Economy by Rooney et al. ( 2005 ).

Since we already know who the precursors are, the next step is to use the surnames of the precursors comprising ‘machlup’, ‘drucker’, ‘bell’, ‘rubin’, ‘nonaka’, ‘takeuchi’, ‘von krogh’, ‘davenport’, ‘prusak’, ‘volpel’, ‘van dijk’, ‘castell’, ‘UN’, ‘UNESCO’ and ‘OECD” (altogether, fifteen names) to conduct a literature search to find who are the followers and critiques of these precursors. The search criterion for the publication period is from 1980 and 2020 (41 years), but the disciplines of the journals (e.g. management or production) are not set as a criterion for the literature search so as to obtain as many articles as possible. The starting year chosen is due to data availability as most search engines are not able to locate articles prior to 1980 (Choong, 2014 ). The literature search is based on a systematic review methodology as it is preferred to the traditional literature review because the former is particularly suited in a large literature survey for the gathering, evaluating and analysing of all the available articles relevant to a set of research questions (RQ) (Leseure et al., 2004 ; Kitchenham & Charters, 2007 ; Choong, 2014 ).

All literature searches were conducted using major journal databases such as ABI/Inform ProQuest, Emerald Full Text, Scopus and EBSCO. To be very certain that no relevant articles were left out from the literature search, a search was conducted on the Internet using Google Scholar for any publications pertaining to this research from 1980 onwards. While this procedure did not guarantee an exhaustive collection of all relevant knowledge economy articles, we believe that a large majority of relevant papers were found, and the resulting findings from this research suffice to provide a strong conclusion concerning the topic of the knowledge economy.

Content Analysis

Content analysis needs no introduction as it is a widely used method in social sciences and humanities to identify commonalities (common grounds) for studying and/or retrieving meaningful information from documents (Krippendorff, 2004 ; Jones, 2019 ) oriented to the study of ‘mute evidence’ of texts and artefacts (Hodder, 1994 , p. 155). Content analysis involves the selection of articles that have a high content of a research question, not people. But no matter how hard one tries, one just cannot analyse content in all possible ways, and this means it is impossible to be comprehensive. Hence, after the analysis, you will usually want to generalize those findings to a broader context—in other words, you are hoping that the issue you selected is a representative sample. Although content analysis is usually used to analyse written words, it is a quantitative method. The results of content analysis are numbers or counts, for example, how many authors use the term ‘knowledge economy’ as compared with those using ‘information economy’. The numbers and counting serve two purposes: to (1) remove much of the subjectivity from summaries and (2) to simplify the detection of trends. These help to aid human judgement in assigning relevance to the content.

Critical Analysis

Critical theory is well suited for this research as writing about the knowledge economy (which is considered a social science) is in many ways subjective where terms are used discriminately, and there is no cohesive body of thoughts (theory) in explaining what this form of economy is about. Critical theory is all about challenging what we have been told; it does enable us in developing a universally coherent study of the field through critical analysis and objective assessment of the content of articles.

In particular, we follow the Horkheimer’s ( 1982 ) approach in applying critical theory in structuring our paper. This is because Horkheimer wanted to distinguish critical theory as a radical, emancipatory form of social theory oriented toward critiquing and changing society as a whole in its historical specificity—it provides the descriptive and normative bases for social inquiry aimed at meeting three criteria: it must be explanatory, practical, and normative, all at the same time. Thus, Horkheimer’s approach is most consistent to the knowledge economy/society because it must explain why the knowledge economy cannot fit with current economic and social reality, identify the actors/phenomenon that bring about the change and provide both clear norms for criticism and achievable, practical goals for economic and social transformation.

The Precursors of the Knowledge Economy

Here, based on Rooney et al. ( 2005 ), and Godin ( 2010 ), we review and summarize the fundamentals of the KE divided into two subsections: (1) the first wave of studies on the knowledge economy and (2) the second wave of studies on the knowledge economy.

The First Wave of Studies on the Knowledge Economy

The first economist to write about the new economic direction of policymakers was the notable Austrian economist, Fritz Machlup (1902–1983). In The Production and Distribution of Knowledge in the United States , Machlup ( 1962 ) defined knowledge and prescribed the usefulness of knowledge in multi-facet perspective, especially on how it is used in production in creating the knowledge industry. In 1970, with Una Mansfield, they emphasized that education provides important impetus in creating a society that relies on information and knowledge in creating jobs and foster growth and the knowledge sector is increasingly growing in importance. In particular, Machlup’s books give rise to a new idea of learning and discourse that could impact an economy, now termed as the knowledge economy .

Peter Drucker (1909–2005), another Austrian economist, was quick to capitalize on Machlup’s idea when he wrote The Age of Discontinuity (Drucker, 1992a ) where the term knowledge workers was used for the first time. To Drucker, knowledge workers differ from manual workers as the former, mainly work with their heads, not hands, and produce ideas, knowledge and information. Drucker was describing these changes in the US economy during the 1930s when R&D departments were just blossoming in organizations. The emergence of knowledge workers causes changes in social, political and economic factors in the USA, resulted in the emergence of the KE.

The pace of the change in the US economy quickened in the late 1960s and early 1970s where there was a sudden influx of service workers in big towns and cities from rural farms—the most obvious measure of the transition from manufacturing to a service-based economy. To capture this change, Daniel Bell (1919–2011), a US sociologist and a neo-conservative, in The Coming of Post-Industrial Society (Bell, 1973 ), hypothesized that a new form of society, coined as the post-industrial society , will emerge in the USA and in other developed countries. This idea is ‘primarily’ about the change in US society brought about by changes in the economy, nature of work and politics from a nation producing goods to one based on a service economy. He asserted that the post-industrialized economy is not universal as it relates only to those countries that have successfully transformed from an agricultural economy to manufacturing economy. Later, Bell ( 1979 ) renamed this concept the Information Society ( IS ), for which he continued to discuss the significance of information and education in the creation of knowledge.

In 1977, Marc Uri Porat and Michael Rubin, both employees at the US Department of Commerce, wrote a Federal policy handbook that measured and estimated the size of the ‘information activity’ of the US economy, which is called the Information Economy ( IE ) . They found that the creation, handling and distribution of information were fast becoming a major economic activity for all nations of the world, be they rich or poor, developed or less developed. Porat and Rubin’s works have since been used in the USA, several countries and the OECD in describing the information economy.

The Second Wave of Studies on the Knowledge Economy

Nonaka and associates provided a new framework in the study of knowledge as (i) knowing and (ii) valued products produced by knowledge workers (Nonaka, 1991 , 1994 ; Nonaka & Takeuchi, 1995 ). Nonaka and Takeuchi ( 1995 ) conceive that human knowledge can be differentiated between explicit and tacit knowledge—the hallmark of their thesis. Explicit knowledge is ‘knowing that’ knowledge we can express and is contained in manuals and procedures; hence, it is coded and transferable, and tacit knowledge is scientifically articulated as ineffable or ‘knowing how’ (knowledge we cannot express) (Polanyi, 1966 ). Tacit knowledge is learned only by experience, and communicated only indirectly, through metaphor and analogy (Nonaka & Takeuchi, 1995 , p. 58–63). Later with von Krogh (von Krogh et al.,  2000a ; Nonaka & von Krogh, 2009 ), they hypothesized that successful knowledge creation activities are supported by a SECI model , the acronym for Socialization, Externalization, Combination and Internalization. The works of Nonaka ( 1991 , 1994 ), Nonaka & Takeuchi ( 1995 ) and Von Krogh et al. ( 2000a , b ) are regarded as the precursors of Knowledge Management ( KM ).

Davenport and colleagues adopted part of Nonaka and Takeuchi’s conceptualization of human knowledge and indicated that by transferring their tacit knowledge to fellow workers, knowledge workers have a more vital role to play in the contribution of business strategy (Davenport & Prusak, 1998 ; Davenport & Völpel, 2001 ; Davenport, 2005 ). They argued that it is the tacit knowledge that is crucial to management as it is embedded in organizational routines, processes, practices, norms and innovations. As yet, a theory of knowledge management has not been reached (Pawlowski & Bick, 2012 , p. 96).

At about the same time, the Dutch information sociologist, Jan van Dijk, defined the Network Society ( NS ) as a ‘social formation with an infrastructure of social and media networks enabling its prime mode of organization at all levels (individual, group, organizational & societal)’ ( 2006 , p. 20). He observed that in the era of widespread use of microcomputers, the Internet and various IT devices link people and organizations together, and that when a society has attained these forms of informational and network structures, society is in a process of becoming a network society. Under a similar vein, Manuel Castells, the Spanish information sociologist, extends the information age trilogy to the NS and emphasizes the importance of networking (Castells, 1997 , 2010 ). He argued that in the information age, the increasing use of networks ‘… constitute the new social morphology of our societies, and the diffusion of networking logic substantially modifies the operation and outcomes in processes of production, experience, power, and culture’ (Castells, 2010 , p. 500).

To UNESCO, according to its General Sub-Director for Communication and Information, Abdul Waheed Khan, the concept of knowledge societies ( KS ) is preferable to that of the ‘information society’ because the former includes a dimension of social, cultural, economic, political and institutional transformation: collectively, a more pluralistic and developmental perspective that better captures the complexity and dynamism of the changes taking place (UNESCO, 2003 , p. 7 − 8). Thinking that the term and its expression are perfunctory and have not gone far enough, the OECD changed its inculcation theme by defining it as the knowledge-based economies ( KBE ). The OECD ( 1996a , p. 3) defined the KBE as ‘economies which are directly based on the production, distribution and use of knowledge and information’ that represents the emergence of a ‘super’ economy that is knowledge-based which brings in many benefits, and thus, developing countries should utilize knowledge and the creation and sharing of knowledge across countries in order to reap these benefits.

In more recent development, the European Bank for Reconstruction and Development (EBRD) advances the concept of the knowledge economy as a part of economic development, in which innovation and access to information drive productivity growth (EBRD, 2019 ). New trends, such as the Internet of Things (IoT) or digitalization, are examples of key elements of the transition towards the knowledge economy. To measure the discerned knowledge economy, the Bank has constructed the EBRD Knowledge Economy Index, spanning 46 economies (38 where the EBRD invests and eight comparators (members of the Organisation for Economic Co-operation and Development, OECD)) divided into four pillars of long-term knowledge-enhancing activities: (1) institutions for innovation, (2) skills for innovation, (3) innovation system and (4) ICT infrastructure. Among the EBRD regions, Estonia scores highest and Turkmenistan lowest.

In sum, the various terms used and the gist of the writings by the precursors of the knowledge economy/society are depicted in Table ​ Table1 1 .

Terms/topics used by precursors of the knowledge economy/society

There are eight terms prescribing the knowledge economy/society or variation of such economy/society. For instance, Machlup was discussing about the knowledge industry while Drucker talked about the knowledge economy. Nonaka and Takeuchi and associates centre on knowledge, and knowledge creation within an organization, and when these activities are aggregated on a macro level, a kind of KE emerges. Van Dijk and Castells discussed about the network society. This multiplicity of terms is confusing as they can describe either the same or different things, and this inevitably spur scholars and critics (including us) to question the assumptions and rationale behind the work of the precursors. To us, we want to know whether the various terms are used in a casual manner or there is a serious discourse to refer to the knowledge economy. In our content analysis, we found that 91 out of the 121 articles (76%) in our References use the term ‘knowledge economy’ which confirms our earlier assertion that this term is most commonly used to describe this kind of the new economy.

Commentary of the Precursors of the Knowledge Economy

The commentators of Machlup’s thesis of an information and knowledge industry indicated that it lacks traditional economic theoretical foundation (Godin, 2006 , 2010 ) and subjective methodology in formulating models (Apte & Nath, 2004 ; Connell, 2007 ). At best, it only provides a crude retrospective approximation of modern economies (Ormerod, 1997 ), and there are scepticisms about data and his analysis (Godin, 2010 ). More specifically, Machlup’s definition of knowledge is ambiguous and his definition of the ‘knowledge industry’ was extremely wide, encompassing everything from the production of typewriters and filing cabinets to electronic, print advertising and mass media (Godin, 2008 , 2010 ). Arrow ( 1984 , p. 142–3) stated that Machlup’s definition of the knowledge/information economy runs contrary (flaw) to the economic ‘meaning of information is precisely a reduction in uncertainty’, which would exclude ‘information producing’ activity such as advertising, market research and most reports about the new economy. In our content and critical analyses, while we concur with the commentators that Machlup’s works lack theory (including poor definition of the knowledge and its industry), we acknowledge his meritorious work in the advancement of knowledge and its usefulness in production, and this sector is increasingly growing in importance. And this has proven right.

Drucker’s writings have been criticized for lacking academic and scholarly content where principles were far from obvious or still not defined (Parkinson et al., 1987 ; Edersheim, 2007 ), for being contradicting (Parkinson et al., 1987 ) and for being cryptic in his pronouncements as his works lack empirically testable propositions (Edersheim, 2007 ; Sapru, 2008 ). Drucker portrays knowledge workers as the preferred workers in a society which is akin to ‘brains over brawns’ in an economy where knowledge, knowledge management and skills dominate (Hadad, 2017 ). To Drucker, knowledge workers are the key to innovation and knowledge to an organization, and having them would enable organization to generate new products and inventions. In our analysis, although we do find Drucker’s writings to lack academic fervour, to be sometimes contradicting and to be apt in making arresting generalizations rather than to offering rigorous arguments in advancing a rationale of what actually is the KE, we do find meritorious aspects of his work, especially with respect to the notion that knowledge workers are the ones that give ideas and knowledge that initiate R&D activities in firms in boosting capability and the advancement of an economy.

Bell’s writings have been described as wide and to use imprecise terms (Waters, 1996 ). Gorz ( 1982 , p. 84) argued that the economic activities during the industrial era and Bell’s post-industrial economy era are basically the same. Robins and Webster ( 1999 , p. 80) stated that the information society, in fact, ‘can be, and has been—achieved on the basis of minimal technological support.’ Such assumptions are ideological in nature because they would fit with the view that we can do nothing about change and have to adapt to existing political realities (Webster, 2004a p. 267). Critiques (Gorz, 1982 ; Giddens, 1990 ; Waters, 1996 ; Robins & Webster, 1999 ; Mackay, 2001 ; Webster, 2002a , b ; Cornish, 2011 ) argue that the growth of information does not alter the attributes of the overall capitalist structure. Our content analysis indicates that the term post-industrial society originated from Alain Touraine (1925–) where many facets of his ideas such as the shaping of a ‘newer’ form of society through structural mechanisms (management, production, organization, distribution) are not much different from Bell’s indication that as wealth increases through incomes generated by workers, new demands arise for ‘luxury’; personal services such as hotels, restaurants and entertainment; and the demands for the government to provide for better health and education services. This, in our view, is a logical extension of economic activities from an industrial society to a post-industrial society, and thus, the terms post-industrial economy and post-industrial society are synonymous.

The studies of Porat and Rubin have been criticized for the lack theoretical building blocks (Miles, 1990 ; Engelbrecht, 1997 ; Wellenius, 1988 ; Apte & Nath, 2004 ), use of inappropriate measurement systems (Engelbrecht, 1997 ; Wellenius, 1988 ; Apte & Nath, 2004 ), lackluster categorization methodology (Apte & Nath, 2004 ), use of unadjusted statistics which may inflate the size of the information economy (Apte & Nath, 2004 ) and the reflecting of a mixture of information and service-business activities rather than knowledge (Arrow, 1984 ). Our content analysis confirms these critiques’ assertions that the assertion and reported numbers of Porat and Rubin lack measurement theory, and there was inadequate classification between information and non-information activities. Let us elaborate. First, the data reported by Porat and Rubin was obtained from government statistics where the various production and service activities are measured on the traditional value-added basis rather than on innovative or information-based basis. Due to this, actual information activities are not differentiated from economic activities. Second, due to inadequate classification between information and non-information activities, goods and jobs, we consider the actual size of the information economy as advocated by Porat and Rubin to be overstated. Third, we argue that even if we accept Porat and Rubin’s classification and measurement methodology, new information activities continually emerge with the advent of new technology, the application varies and the nature and scope of occupations have been continually changing making it imperative that the list of information activities, application and occupations be evaluated and updated regularly. Fourth, we notice that much of Porat and Rubin’s ideas are derived from earlier precursors (i.e. Machlup and Drucker) with little innovation of their own, and thus their works do not sit well in rigorous academic research.

The works of Nonaka ( 1991 , 1994 ) and Nonaka and Takeuchi ( 1995 ) have attracted numerous commentaries and relentless attacks for their (1) conception of knowledge and (2) knowledge creation (innovation) and knowledge management. First, critiques such as Jorna ( 1998 ), Wilson ( 2002 ), Hildreth and Kimble ( 2002 ) and Gourlay ( 2006 ) have criticized that Nonaka and his co-authors link tacit knowledge to an East-Asian phenomenological epistemology that is heavily influenced by Confucianism, Zen Buddhism and the collectivism culture of East Asia when putting forward their tacit and explicit knowledge arguments in advancing the concept of knowledge for commercialization. Second, Nonaka and Takeuchi’s SECI framework is subjected to the critiques that it is oversimplified in catering for knowledge management as the articulation of knowledge appeared to be possible even for tacit knowledge, and their statement that the sharing of knowledge can be achieved through a socialization process seems obnoxious (Jorna, 1998 ; Choo, 1998 ; Wilson, 2002 ; Hildreth & Kimble, 2002 ; Swan & Scarborough, 2002 ; Styhre, 2003 ; Kupers, 2005 ; Gourlay, 2006 ).

We consider the criticisms of Nonaka and Takeuchi on both counts to be misguided, myopic and unwarranted in many respects. First, basing on content and critical analysis, the critiques against Nonaka and Takeuchi of using non-Western epistemology in advancing an interesting new phenomenon of firms using knowledge in managing activities that can improve a country’s competitiveness are not based on constructive substantiation or hard evidence that there is any fallacy of East Asian philosophy as used in knowledge application. We also argue that the study of knowledge has been heavily undertaken in East Asia for thousands of years where Confucianism, Shintoism, Taoism and Buddhism play a great part in instilling what knowledge is about. We however, recognize that there are differences in the approach between East Asian and Western epistemology, but the outcome is likely to be the same. Based on the prevailing traditional Western epistemologies, knowledge has mainly been gained through observation and reasoning; however, in traditional Chinese thought, knowledge has been understood in a much broader sense (Rosker, 2014 ). More specifically, Western philosophy is about dialectics which contains thesis and antithesis and how they are resolved through synthesis, whereas in Eastern philosophy, a phenomenon such as KM is viewed as inherently paradoxical where the interrelatedness of the phenomenon in question is in terms of opposites that neither compromise nor repel each other but rather work in the dynamic combination of those dual entities and thereby build a composite whole (Chae & Bloodgood, 2006 ). They state that knowledge exists in the form of both tacit and explicit and, as such, social and technical, together building one composite whole—the Tao or the ‘ideal’ approach to KM—implying that in duality, unity is found (Chae & Bloodgood, 2006 , p. 7). As a consequent, these critiques fail to see and understand how Eastern countries such as China, Japan, South Korea and Taiwan (China) have successfully managed knowledge in pursuing innovations and inventions.

Second, in retrospect, Nonaka and Takeuchi had indicated that their approach in establishing a workable knowledge-based model is still ongoing and various aspects of work still remain to be done and called for more research to validate his model. Instead, these critiques merely argued that tacit knowledge is difficult to articulate, and hence it is quite impossible to transfer since ‘tacit’ means ‘hidden’, and that tacit knowledge is hidden knowledge. This testimony is nothing new as it was posited by Polanyi ( 1958 ), but these critiques failed to understand that in Nonaka & Takeuchi’s thesis, tacit knowledge alone does not suffice, that a socialization process is needed to transfer tacit to explicit knowledge in creating knowledge outcome. Notwithstanding these criticisms, the SECI framework has now attracted many prominent researchers such as von Krough, Davenport, Prusak and Volpel and they have contributed to the refinement of the framework.

Opponents of van Dijk’s network society consider that his form of society organized around global networks of capital, social, management and information through the multiplicity of interconnected tasks to be nothing more than a contemporary society (Fuchs, 2009 ). There is nothing theoretical about how a society can become a network society besides by stating propositions and facts that are currently in existence (Webster, 2002a , b , 2004 ). From the writings of critiques, we detected that there are two key issues of the network society as advocated by van Dijk. First, this kind of network society may only be achieved partially as it depends on high educational attainment and high educational use (see Di Maggio & Celeste, 2004 ) and is perceived in creating a digital divide (see Norris, 2001 ; Nakata, 2002 ; Rice & Haythornthwaite, 2006 ; Abdulla, 2007 ; Sharma et al.,  2008 ; Allagui, 2009 ). To us, the reported increasing, widening and thickening of networks in nature and society by van Dijk indicate that networks have become the nervous system of society rather than one that helps to bridge people and society through the application of technology. Second, in view of the first point, even developed countries are not able to develop into a full-fledged network society as advocated by van Dijk.

Our analysis indicates that the content of the network economy as advocated by Castells is nothing more than a rephrasing of the term information economy or knowledge economy as his assertion has been made before by Bell, Porat, Rubin, Nonaka and Takeuchi, among others. This is nothing more than technological determinism (see Webster, 2002a , b , 2004 ; Garnham, 2004a ). Thus, in our view, networks and the network society are nothing new. If there is anything new, it can be perceived as the microelectronics-based, networking technologies that provide new capabilities to an old form of social organization that characterized the industrial society. That is, the network society is viewed as a social economy , and it has very little to do with factors of production or knowledge management.

We analyse the content of the description of the knowledge society advocated by the UN and UNESCO, and the knowledge-based economy by the OECD. According to Godin ( 2004 , 2006 ), the writings of the UN, UNESCO and the OECD lack academic rigor and instead they are meant to be rhetoric. Relatedly, Smith ( 2002 , p. 6) indicated that the various terms linked to an economy that is referred to as ‘ knowledge-intensive ’ or ‘ knowledge-based ’ are used in a superficial and uncritical way as there is no coherent definition, let alone a theoretical concept to explain their differences from one another. UNESCO led us to believe that lifelong learning can be achieved by uniting the community of scientists, researchers, engineers and technicians, research networks and firms involved in the process of research and production of high-tech goods and services, and so doing will integrate into international networks on production, distribution, use and protection of knowledge (Hadad, 2017 ). From our analysis, the term knowledge society is conveniently coined to tell us that we live in a ‘Shangri-La kind of society’. However, the statistical outcome tells another story. Although both bodies (which are under the same umbrella) use the same data and the same statistical technique, they produce different outcomes and these differences reflect different understandings of what the knowledge society is (see Oxley et al., 2007 , p. 17), suggesting that the characterization of the knowledge society is flawed.

The term knowledge-based economy is rhetorical (Godin, 2004 , p. 680,  2006 , p. 19), a metaphor ‘often used in a superficial and uncritical way’ (Smith, 2002 , p.5), and is a buzzword (Godin, 2004 , p. 688). To Godin ( 2004 ,  2006 ), the moves by the OECD appear sinister as they led us in falsehood in believing that the new economy is already in existence or is a paradise we ought to aspire. To Sharma et al. ( 2008 , p. 152), the concept of a knowledge-based economy is nothing more than an information economy except that the former is broader as, in addition to technical knowledge, it also includes culture, social and managerial knowledge. The OECD, being a grouping of developed countries, is often a political tool for member governments in promoting familiar proposals around training, skills and infrastructure and sustainable growth coupled with better education and wider access to high-speed internet, and yet, the amount of public investment of those activities contemplated is comparatively low (O’Donovan, 2020 ).

Finally, we evaluate the content of EBRD. The priority areas for EBRD operations and activities are laid out in Article 1 of the institution’s founding constitution, which are (1) developing the financial sector through technical assistance to governments and bank officials; (2) supporting the creation of new financial institutions; (3) developing infrastructure, information technology, telecommunications and transportation, improving energy consumption and ensuring a healthy environment; (4) converting the military industry for civilian use; (5) general privatization; (6) restructuring existing industries; and (7) supporting small and medium-sized enterprises (Besley et al., 2020 ; Shield, 2020 ). These overlap considerably with the objectives of the IMF and World Bank. Many critiques and NGOs have criticized the EBRD on the lack of progress the Bank makes in its main mission, the ‘transition towards open, democratic and progressive market economies’; moreover, they consider some of its funded projects to be environmentally and socially harmful (Neslen, 2015 ; Bankwatch, 2017 ). Therefore, the EBRD aims at engaging policymakers and influencing policy debates rather than adopting policies actively provocatively towards a knowledge economy. Moreover, there is a general lack of economy or any theory and relatively little academic analysis of the EBRD, yet it is an institution in the vanguard of development strategies both in and increasingly well beyond Eastern Central Europe (ECE).

We summarize the key commentaries of the knowledge economy as advocated by the precursors of the field in Table ​ Table2 2 .

Major criticisms of the knowledge (information, network, management) economy (industry, society) in relation to research implications

In our content analysis, we found that all of the 27 key commentators of the first wave of studies on the knowledge economy were critical of the views of the precursors. The works of Machlup, Drucker, Porat and Rubin, and Bell are closely related, but the definition of knowledge (information) by these precursors is so wide that it is anything but knowledge, and an appropriate statistical technique in classifying information and knowledge is wanting. For instance, when describing how knowledge workers use their heads, not hands, in producing goods and services, Drucker also mentioned that these workers should also like to please the boss. And when he wrote about social, political and economic changes of the ‘postcapitalist’ era of the ‘First World Nations’, meaning the USA, ordinary citizens become virtually owners of the great American enterprises, i.e. being owners of the capital in overcoming capitalism—an arresting statement that has little to do with the knowledge economy. Nevertheless, in spite of certain inaccuracies, we regard Drucker’s works of merit where he did make a number of accurate forecasts, as well as astute perceptions of 1993 that remain true today: (1) the developed countries will be inundated by a human flood of Third World immigrants; (2) in knowledge work and in most service work, the machine (if any) is a servant to the worker; (3) a severe problem is the diversion of the scarcest resources—trained engineers and scientists to economically unproductive defence work—the malefactor being the USA where over 70% of all money spent on R&D is spent on defence work (affirm by Phillips et al., 2017 ); and (4) knowledge, knowledge workers and technological progress determine quality of products—the case of Japan being the first non-Western nation in modern times to become a great economic power. According to Drucker ( 1993 ), the winners in this new economy will be those who master knowledge about knowledge.

Of the 33 key commentaries of the second wave, only the works of Nonaka and Takeuchi received some favourable commentaries, and in fact, their notable work on the SECI framework has been embraced by notable researchers. We consider that Nonaka and Takeuchi had initiated a difficult paradigm of articulating tacit knowledge in the conception of knowledge in knowledge creation (management) where, if properly transferred (applied) among knowledge workers, it would lead to the sustaining of competitive advantage of firms and the collective effort of firms would enable the country to prosper in the future. On the contrary, the network society expounded by van Dijk and Castells is nothing more than a mere extension of the information economy. Third, we rule out the writings of the UN, UNESCO, OECD and EBRD to be scholarly and worthy of research consideration as they not only lack academic rigor but also meant to be rhetoric or myths. Moreover, we see they serve certain government policies and political agendas that are geared towards the West, particularly the OECD and the EBRD.

We feel that one particular crucial aspect both the first and second waves of studies of the knowledge economy have missed out is health matter—to build a strong and progressive society/economy, there must be in place a good health system to take care of not only knowledge workers but also the population in general. Investment in health is not only desirable; it is an essential priority for most societies. This is especially so in view of the current Covid-19 pandemic. Healthcare performance is strongly dependent not only on the economy but also on the health systems themselves: all these are essential to a healthy society (Eissa, 2020 ).

Theoretical Consideration in Advancing the Research on the Knowledge Economy

Seeking common ground in the furtherance of the research of the knowledge economy.

Despite the various issues surrounding the works of the knowledge economy, there are commonalities of thoughts and propositions among the precursors, suggesting that there is a common ground for us to establish some theoretical foundations of the field. First, we need to rationalize whether the terms economy and society have any significant difference in meaning. The relationship between economy and society and how it is determined is a matter of theoretical debate. The classical economists (including Emile Durkheim, 1858–1917; and Max Weber, 1864–1920) have articulated a new form of the economy (at their time) in a way where people envisage is probable. Durkheim viewed the economy as one of the numbers of social institutions that make up a society, and Weber viewed the economy in part as an extension of social values and religious belief. Therefore, the economy and society are inextricably linked.

Second, in our critical analysis, we realize that the differences in terms used by the precursors of the knowledge economy are partly due to the time factor because the stages of the economy change with time. In the industrial economy , an old economic dictum of Adam Smith (1723–1790) existed from the eighteenth century in which agricultural products and mass-produced manufactured goods were the key components of the economy, and the majority of workers were farmers, clerks or machinists. The post-industrial economy ( information society ) is the period from the late 1960s where mass production from the developed countries shifted to developing countries, and the mainstay of economic activities of the developed countries is services supported by technology (mainly computerization) and changes of society (social values).

Nonaka, Takeuchi, Davenport, Krogh, Prusak and Volpel focus on knowledge on the organizational level, i.e. knowledge management, which when aggregated among firms would contribute to the notion of the knowledge economy. This period is around mid-1990s. Despite critiques claiming that there is no difference between an information economy and a knowledge economy, we argue that knowledge is more than information because knowledge is being creative and innovative (i.e. it uses information to make things different from others), thus giving us a competitive advantage. That is, the use of knowledge is increasingly of a greater magnitude and importance in a knowledge economy era (Houghton & Sheehan, 2000 ; Giddens, 2001 ; Powell & Snellman, 2004 ; Roberts, 2010 ; Garza-Rodriguez et al., 2020 ). In a study conducted for Mexico, the results show that the impact of human capital on economic growth is almost three times greater than that of physical capital (Garza-Rodriguez et al., 2020 ). Notice that none of the precursors emphasize on production and consumption. The various stages of economic (societal) development are depicted in Fig. ​ Fig.1 1 .

Stages of economic and social development

Figure ​ Figure1 1 shows the evolution of the economies (societies) from the pre-industrial to industrial stage and finally to the post-industrial stage. In the post-industrial stage, three variations of economies/societies are envisaged. The information economy (society) is the progression from the industrial economy (society). While there is a progression from the information to knowledge economy, the path of the network society is difficult to envisage as it appears that it is in a stage of a continuum but where it is heading is unknown. It does not mean that once a country/society has attained a high amount of ICT expenditure or economic development, it can be considered a knowledge economy. Take the case of Hong Kong, HK (China), many of its residents and HK specialists regard HK as a knowledge economy, but in actual fact HK is predominately a service economy rather than a capital-intensive technologically advanced economy. Zhu and Chou ( 2020 ) indicate that although HK has made improvements in knowledge-induced productivity from 1991 to 2011, it still has some ways to go to meet the requirements of a knowledge economy. There is still an economic gap between occupations that are knowledge-intensive and knowledge-non-intensive, and there are overeducated employees who find themselves unemployable. Unless these deficiencies are addressed, transforming HK’s economy from a service economy to a knowledge economy appears unattainable.

What is more important is that, from the study of the various precursors’ works, we are now getting nearer in understanding this new kind of economy, i.e. by finding a common ground to show how a society becomes a knowledge economy:

• We estimate the starting point of the knowledge economy to be mid-1990s.
• There is no difference whether the new economy is viewed as an economy or society.
• The knowledge economy is not really an economy based solely on production and consumption by exploiting labour and capital, but it is based more on a social value and structure.
• Extensive use of technology and the ability for us to exploit them for commercial reasons and for personal and organizational enjoyment (i.e. sociability or societal benefits).
• Extensive use of innovation to commercialize knowledge (knowledge creation, knowledge management)

Theoretical Framework of the Knowledge Economy and Its Usefulness for Future Research

The discussion from the previous subsection provides us with the theoretical foundation needed to define a knowledge economy (see Fig. ​ Fig.2 2 ).

Suggested key aspects of the knowledge economy that may be considered as the common ground in researching the field

In Fig. ​ Fig.2, 2 , the knowledge economy consists of sociability, technology, knowledge and innovation, and knowledge products.

The authors/articles who have contributed to our foundation of the Knowledge Economy/Society are presented in Table ​ Table3 3 :

Authors (articles) who contributed to our foundation of Knowledge Economy/Society

Our discussion of the sub-header will be made in conjunction with Fig. ​ Fig.2 2 and Table ​ Table3 3 .

Social Economy

In our critical analysis, we found that the knowledge economy is not an all-encompassing economy as it cannot address (all) the various aspects of technology, innovation and organizational and people’s needs. Moreover, the knowledge economy lacks a theory. In our search for solutions, we found that this kind of economy that can offer us with good explanations of the radical change in the ways people think and expect in a society, and how organizations (institutions) are utilizing innovation by tapping the power of technology in creating knowledge products in the furtherance of the economic well-being of a society (country), is viewed in terms of the social economy .

We found that the idea of the social economy has attracted researchers, governments and non-government agencies especially in continental Europe and Canada (Gueslin, 1987 ; Demoustier, 2004 ; Moulaert & Ailenei, 2005 ). According to these writers, the social economy apparently arises through the progression of time, and its theoretical foundation can only be analysed by combining a ‘history of practice’ with ‘a history of thought perspective’. The nineteenth century ought to be taken as the formative era of the modern social economy as it was characterized by an outburst of ideas, concepts and experiences; cooperative, associative and social awareness; institutional and utopian initiatives and the emergence of social, economic and political liberal philosophies in reaction to the social brutalities (poverty and exploitation), and political indifference (lack of social welfare) of the Industrial Revolution. This assertion is also shared by Le ´vesque et al. (2001; cited in Moulaert & Ailenei, 2005 ).

These writers also asserted that the theoretical arguments tend to be recurrent, and that the social economy is not an economic system on its own as there are diverse views of the foundation of this kind of economy. The diverse views may create a magnitude of possible theoretical foundations of what constitutes a knowledge economy. Because of these, it is exceedingly difficult, and probably not scientifically useful, to reconcile the wide world of initiatives and activities connected to the social economy in a ‘one for all’ definition (Moulaert & Ailenei, 2005 ).

In our content and critical analyses, we find that one social thesis that takes into consideration personal needs is the one that has been put forward by the international philosopher, author, poet, composer and linguist, P.R. Sarker (1921–1990). A series of lectures were published in 1959 as Idea and Ideology , where Sarkar described a socio-economic theory which he called Progressive Utilization Theory (PROUT) (Sarkar, 1959 ). The PROUT is based on progress, philosophy of life, spiritual belief and utilization of the qualities of practical education (as against academic education), morality and socio-economic consciousness in an economy in order to provide a good standard of living to all people and to see that economic power is not concentrated in the hands of a few.

In some ways, PROUT philosophy is akin to Drucker’s ( 1993 )  Post-Capitalist Society , Bell’s ( 1973 )  Post-Industrial Society or van Dijk’s ( 1999 )  Network Society in which developed societies that have exploited IT successfully will be able to transform from an agricultural economy to knowledge economy—towards a utilization society where there is a good standard of living to all people and to see that economic power is not concentrated in the hands of a few. Bell asserted that his thesis is about the attainment of an industrialized society and is not universal as it relates only to the USA while Drucker’s thesis applies only to developed countries such as the USA, Western Europe and Japan, and van Dijk considers that all countries are capable of attaining the network society status if they have successfully utilized IT. Except for van Dijk, the various KE writers are rather biased as they see that only the USA, Western Europe and Japan can become advanced economies. Little did they realise that South Korea, Taiwan (China) and soon China would become advanced technological countries.

It is true that the USA, Western Europe and Japan are wealthier countries than some of the developing countries, and so they can invest in a variety of things notably in health care. For instance, the USA devotes more of its national income to healthcare relative to other OECD countries where the OECD averaged about 8.7% of annual GDP; healthcare spending in the USA, however, stood at 17% while the rest of OECD countries range between 9.0% (Spain) to 12.1% (Switzerland) at 2019 (World Bank, 2020 ). This compares with 5.08% (Sub-Saharan countries), 7.96% (Latin American & Caribbean countries), 3.48% (South Asian countries), and 6.67% (East Asian & Pacific countries) (World Bank, 2020 ). Higher healthcare spending can be beneficial if it results in better health outcomes. But looking at the statistics, surely the USA and OECD countries would have spent much more on health and the outcomes ought to outperform developing countries. However, this is not the case. In view of the Covid-19 pandemic, the USA and developed countries fare worse than some developing countries notably East Asian countries like China, Taiwan (China), Vietnam and Thailand. High administration costs including salaries of medical professionals and high medicine costs are among the reasons cited why the USA and OECD countries have higher healthcare expenses in relation to developing countries (Peterson Foundation, 2020 ). Moreover, pandemic preparedness and response capacity of these countries are less efficient compared with the East Asian countries. Pandemic preparedness is not a new concept as several pandemics have occurred before. For instance, China and Vietnam can plan, mobilize and utilize resources and deploy emergency assets in quick time and they can treat and monitor patients on a sustainability basis. A healthcare system with high costs, inadequate preparedness and response and poor outcomes undermines our economy and threatens our long-term fiscal and economic well-being. Indeed, the recent pandemic has given a basic message: investments in health and the design of health financing policies should be addressed in terms of the interaction between health and the economy (Eissa, 2020 ). Just as growth, income, wealth, investment and employment are a function of the performance and quality of the economic system, its regulatory frameworks, trade and political policies, social capital and labour markets, etc., so health conditions (mortality, morbidity, disability, ability to confront pandemic) depend not just on standards of living but on the actual performance of health systems themselves.

Our analyses also reveal other useful findings. In an extensive study of the social economy of Canada, and in particular, Quebec, Ninacs and Toye ( 2002 ) articulated that the social economy is not an entirely new type of economy, consistent to the contention of Gueslin ( 1987 ), Demoustier ( 2004 ) and Moulaert and Ailenei ( 2005 ). Instead, Ninacs & Toye argued that the ‘newness’ related to the evolution of the social economy over the past 35 years or so is due to the presence of new types of people who become promoters or members, new stakeholders, new fields of activity, new organizational forms and new internal and external dynamics. Although many aspects of Ninacs and Toye’s ( 2002 ) arguments relate to knowledge and innovation, the indicated timeframe of the social economy evolution, which was supposed to arise in 1965, was a bit far-fetched from our posited period (mid-1990) of the formative years of the knowledge economy.

We found Brown’s ( 2008 ) work on the social economy relevant. Drawing on a wide range of writings on the social economy, Brown ( 2008 ) finds it useful to think of the theoretical foundation of the social economy in the following ways: (1) it is a branch of the economy that is concerned with the relationship between social behaviour, people well-being and economies, and (2) it is not an unorthodox school of economies (e.g. classical or neo-classical theories) and often takes into account subject matters outside the focus of orthodox economic theories. Thus, the social economy encourages people and society to utilize resources to satisfy human and community needs, including humanity, changes of educational and economic development, promotion of thinking and innovation in which human and society can collectively earn their minimum necessities through appropriate work in producing knowledge products. This economic system can be regarded as the organizational arrangement and process through which a society makes its production and consumption decisions which society deems desirable, like efficiency, growth, liberty and equality, consistent with what Conklin ( 1991 ) had advocated earlier.

In a similar vein, Nasioulasa and Marisb ( 2011 ) indicated that the social economy enhances the promotions of social cohesion, innovative entrepreneurship and employment with the help of digital and network technologies, thus sustaining an economy with a rising social need and the demand for uninhibited access to digital content throughout the cyberspace. This invariably is mainly orientated towards the use of computer technology for the creation of knowledge products. Knowledge products require innovation, and the importance of innovation is even more important in recent years as many markets have become mature, and many mature companies have failed to survive as they fail to capitalize on the exploitation of technology to innovate their products (see Lynch & Jin, 2016 ).

Therefore, in our view, we rule out PROUT to have much relevance to the knowledge economy as the first is too political with a heavy emphasis on the equilibrium of social needs and social and spiritual well-being. We consider that the knowledge economy is a branch of the social economy (as in Brown, 2008 ) (see also in Gueslin, 1987 ; Demoustier, 2004 ; Moulaert & Ailenei, 2005 ; Nasioulasa & Marisb, 2011 ) that is tied to social innovation, reliance on knowledge and technology and use of new types of production in churning out knowledge products or exploiting new markets that bring it into the realm of economic innovation. This is brought about by social entrepreneurs (innovators) working in social organizations where these entrepreneurs combine creativity with pragmatic skills in pioneering new solutions to social problems and in doing so change the patterns of society. Thus, the knowledge economy is a social change theory, much akin to Lewin’s contemporary social organization and management change model (see Huarng & Mas-Tur, 2016 ).

Technology (ICT)

In our content and critical analyses, this new kind of economy is made possible through the explosion and exploitation of technology, in particular ICT which begins from the mid-1990s, largely due to the emergence of the dot.com’s. From our review of the studies of the precursors of the knowledge economy, technology drives two key dynamics: (1) the improving functionality and commercialization of products and services and (2) the reducing unit cost of supplying them. Industry-wide progress clearly gives rise to products that would not have been possible just a few years earlier, and at increasingly affordable prices. Adapting to technological progress is important because the knowledge economy is a continuously adapting field between the public and private sectors, individuals and organizations in which there exists a rising social need and demand for uninhibited access to ICT especially semantic web and digital content throughout the cyberspace. The development of technology allows organizations and the public in benefitting not only from participating to the availability of many new commercial software but, more importantly, from sharing data and their interpretation of information (Robinson & Bauer, 2011 ). This includes innovative modalities among content, user and transit such as peer-to-peer networks that have substantially enhanced digital content delivery (Nasioulasa & Marisb, 2011 ). In Australia, the introduction of the national curriculum in 2013 places high emphasis on the integration of digital technologies throughout key learning areas. There are pedagogical justifications for using ICT across the key learning areas as young children must be made exposed to ICT literacy as it is clear that children learn to use technological devices very quickly (ICTE, 2020 ).

We found that Drucker’s integrative thinking illuminates the special obligations imposed by technology on modern business organizations. From witnessing the early development of technology in industry, Drucker noticed that in organizations, management and society there has been a massive overall change in the nature of technological work during our century—a change in its structure, costs, methods and conceptual underpinnings.

We can connect that the rise of the information society will see the emergence of a network society in which information, computer and technology will enable the formation of networks among users. Essentially, the network society, as Van Dijk sees it, can explain a new type of society where social relations are organised within mediative technologies that form a communication network rather than networks typified by face-to-face social relations. The network is developed in a society that allows for a great deal of information to be processed, exchanged and disseminated to help improve information and communication technologies—that is, it facilitates the globalization of IT.

The technological capability must be harnessed at both the micro and macro levels (Berners-Lee, 2010 ). For example, firms use serious games (i.e. video games used in a professional context) to make training more exciting and immersive as they take players into virtual worlds where they learn and experience real-world scenarios in a funny and entertaining way (Allal-Chérif & Makhlouf, 2016 ). On the macro level, we argue that technological innovation and ICT represent a way for knowledge economic countries to foster economic development, exploit technology (ICT), improve levels of education and training and address social (societal) issues within a knowledge economy, a view similar to OECD ( 2015 ).

Technology prowess does not stem from high ICT spending. High ICT spending by a country may have poor IT utilization, as seen in the case of high health spending which may have low health outcome. Following years of growth, ICT spending will remain relatively flat in 2020 due to the COVID-19 pandemic, and in the next 5 years, all growth in traditional tech spending will be driven by just four platforms: cloud, mobile, social and big data/analytics (ZDNet, 2020 ). For instance, Singapore has been spending heavily on ICT for the past years and the government plans to increase its ICT spend by 30% in its fiscal 2020 (ZDNet, 2020 ). However, Singapore is not considered a knowledge economy because most of its technology comes from abroad. Wang ( 2018 ) found that over 70% of Singapore’s private sector R&D expenditure and the bulk of industry patents came from foreign multi-nationals, and there is evidence that innovation is government ‘push’. Moreover, she is ill-equipped to handle and maintain technology as seen on 14 October 2020, when a damaged power cable led to a series of events that caused a major subway (MRT) disruption affecting three train lines —an incident which transport experts said could have been avoided (Straits Times, 2020  Dec 16).

Knowledge and Innovation (Knowledge Creation)

We argue that the rise of the interest in the knowledge economy has meant that economists have been challenged to look beyond labour and capital as the central factors of production. More recently, Aghion et al. ( 2004 ) have indicated that innovation (knowledge creation) in inducing competitiveness among organizations is considered a third important factor of production. In today’s complex, competitive and turbulent environment, the need for innovation in products and processes is widely recognized and organizations are required to apply new technologies and to innovate timely in anticipation of changes in the marketplace rather than as a reaction to business decline (Rahimi, 2017 ). Although knowledge and innovation have been widely discussed by the precursors of the second wave of studies on the knowledge economy, there are gaps in their articulation, viz. on how knowledge and innovation can help in transforming an economy to one that is based on knowledge. We will now explain this.

We consider thatknowledge is a valuable input that drives innovation, and the output is knowledge product. Knowledge products will be discussed in the next sub-section. In between input and output is knowledge management . Nonaka ( 1991 ) described tacit knowledge as the fuel for innovation but was concerned that many managers failed to understand how knowledge could be leveraged. Organizations are more like living organisms than machines, he argued, and most viewed knowledge as a static input to the corporate machine. Nonaka advocated a view of knowledge as a dynamic mechanism—renewable and changing—and that knowledge workers were the agents for that change. Nonaka and Takeuchi then forwarded the argument that creating knowledge will become the key to sustaining a competitive advantage for organizations in the future. As the competitive environment and customer preferences changes constantly, knowledge perishes quickly and therefore managers and knowledge workers must rejuvenate it. In addition, Nonaka and Takeuchi show that, to create knowledge, the best management style is neither top-down nor bottom-up, but rather what they call ‘middle-up-down’ in which the middle managers form a bridge between the ideals of top management and the chaotic realities of the frontline workers. Thus, knowledge-creating companies, Nonaka and Takeuchi believed, should be focused primarily on the task of innovation.

Innovation can be attributed to various sources, and innovative processes usually involve identifying customer needs, macro and micro trends, developing competencies and finding financial support in order to sell the innovation—a strong motivation for the commercialization, or value creation of knowledge. Businesses must engage customers to develop products that sell. Interestingly, more recently, the casual claim between customers and innovations have been reversed in which customers are the ones that are important in the development of new innovations for commercial purposes (see Lettl et al., 2006 ; Desouza et al., 2008 ; Oberg, 2010 ). The innovation process ends upon the successful transformation of knowledge to innovation, resulting in the creation of value enhancement intellectual capital (IC), or intangible assets (IA) as called in accounting, which can generate future benefits to organizations (see Choong, 2008 ; Lages, 2016 ).

Knowledge Products (Commercialization and for Personal Enjoyment)

So what actually are knowledge products ? The literature indicates a wide range of activities that can constitute knowledge products such as skills, knowledge, know-how, work-related experience, competencies, education, creativity, brand, trademarks, intellectual property (IP), copyrights, trade secrets, work procedures and software, among others. We found that these products are no different from the products of the old economy. There is no clear definition. Drucker attempted to describe knowledge product in a protracted manner. Knowledge workers put knowledge to work and that information is not knowledge. Information must be applied to specific work, and there must have improved performance for it to be classified as knowledge. Drucker emphasized that only human beings with their brains and/or the skill of their hands can convert information into knowledge. The outcome of which the products so developed are new—i.e., newness determines a product to be knowledge product.

As Nonaka and Takeuchi pointed out, ‘understanding how organisations create new products … is important. A more fundamental need is to understand how organisations create new knowledge that makes such creations possible.’ Given in today’s competitive market, technological changes, customer demands and revolutionary technologies combine to place pressure on organizations to constantly innovate and provide cutting-edge outcomes. Nonaka, Takeuchi, Davenport and Völpel have indicated that the key is innovation and developing innovative capabilities such as architectural innovation capability enhances firms’ ability to respond to market demands by producing innovative products and services and can has a profound impact on their performance.

For us, knowledge products differ from other kinds of products in that their relevant and useful aspects reside primarily in the content that can be extracted from them, and as such, any physical manifestation thereof is usually at best a carrier medium . It is about talented people, either on their own or through organizations, on how they use their knowledge to innovate ideas to produce knowledge products. Also, they must have appeal so that the products can be commercialized. Thus, the creation of knowledge products creates social benefits to people, organizations and society. From these explanations, we rule out knowledge work (jobs), such as skills, know-how, work-related experience, competencies, education nad work procedures, to be knowledge products.

From the literature and our analysis, knowledge products are indeed difficult to define. Hence, we use an illustration to explain what exactly knowledge product is. Take the case of a mystery killer storybook written by an author. The book is a physical item, not a knowledge product, and the knowledge product is the intriguing story of the book, which is the research, innovative and artistic outcome arising from the tacit and explicit knowledge of the author, which are required to make it different from another story. Similarly, let us take a look at the music, dance and song of Billie Jean by Michael Jackson. The CD is a physical item, not a knowledge product, and the music, dance, expression and choreography, collectively, are the actual knowledge product. From these two examples, we explain that the physical element and the intellectual element must be differentiated or else there is no clear boundary between a tangible and intangible item. It can be seen that an intangible item cannot exist on its own right. In fact, both tangible and intangible items are complimentary of each other in the form of a knowledge product. Blended together, they create values and bring competitive advantage to the developers (talented people) and organizations. More importantly, the creation of knowledge products necessitates innovation and knowledge sharing, and the commercial outcome is benefits to people and organizations that use them, i.e. a social-economic perspective. More specifically, Muriel and Serrat ( 2009 ) and Rooney et al. ( 2012 ) have described knowledge products as the outcome of the production of knowledge, much of which represents intellectual capital.

There is no data for knowledge products by country. The closest data we obtained is data for high-technology exports in current prices published by Knoema which compiles data for the world and country level from sources such as the World Bank, IMF and OECD. Knoema defines high-technology products as products with high R&D intensity, such as in aerospace, computers, pharmaceuticals, scientific instruments and electrical machinery. In 2019, Knoema ranks HK (China) to be the largest exporter of high-tech products, follow by Germany and the USA. Mexico is placed seventh and Belgium is placed eight. China, which is recognized as a factory for high-tech products, is not represented in the list which consists of 43 countries. Comoros, a country consisting of several tiny islands with less than a million people off the coast of Mozambique (East Africa), is ranked 43rd in terms of largest export of high-tech products. Ironically, HK (China) and to a lesser extend Mexico and Belgium are not really into manufacture of knowledge products. Surely, Comoros is not into high-tech knowledge products. Therefore, reliance on published statistics is misleading as seen in the case of health care and technology prowess.

The framework of the knowledge economy and the statistical assessment methodology proxied by the four proxies are as shown in Table ​ Table4 4 .

The framework of the knowledge economy and the statistical assessment methodology proxied by the four proxies

‘Apparent’ Knowledge Economy Countries

This is the ultimate work with respect to this research, as there is no precedence or methodology concerning how countries can be construed to be knowledge economies. What is important is to establish the statistical assessment methodology for the level of knowledge economy against other type of economies (Rim et al . , 2019 ). They hypothesize the indicators come from two sources: (1) economic growth and the expressions of knowledge-based economy and (2) the statistical assessment methodology for the level of knowledge-based economy based on the first part. From this, we articulate one approach in which proxies (indicators) can be used to measure the four knowledge economy criteria we have thoroughly expounded earlier. They are (1) social economy; (2) technological strength; (3) knowledge & innovation; and (4) knowledge products.

We make use of per capita GDP (nominal) ranking of selected countries in ascertaining how well they relate to these four criteria (see Table ​ Table4). 4 ). Some readers may argue on why we did not use GDP based on a PPP basis. We find that the PPP basis consists of too many consistencies as (1) the purchasing power is subjective; (2) the metrics used were not thorough researched; and (3) the purchasing power tends to give a high value to certain countries. We based our analysis on the selected 18 countries because it is beyond the scope of this paper to list every possible country in ascertaining whether or not they satisfy the criteria of the knowledge economy. We proxied social economy with social progress index produced by Social Progress Imperative, USA. Social progress is defined as ‘the capacity of a society to meet the basic human needs of its citizens, establish the building blocks that allow citizens and communities to enhance and sustain the quality of their lives, and create the conditions for all individuals to reach their full potential.’ (Institute for Strategy and Competitiveness, 2020 ) Technology (ICT) is proxied by the Technology Strength Index which consists of four integrated metrics, three of which serve as standard measures of the availability and prevalence of technology: (1) internet users as a proportion of the population; (2) smartphone users as a percentage of the population; and (3) LTE users as a percentage of the population. The fourth metric we used is a Digital Competitiveness score developed by the IMD World Competitiveness Center. Their competitiveness score focuses on technological knowledge, readiness for developing new technologies, and the ability to exploit and build on new innovations (Global Finance, 2020 ). Knowledge and Innovation are proxied by the Innovation Index, published by the World Intellectual Property Organization (WIPO, 2020 ) and as data is not available for Taiwan (China), we use Innovation Index taken from Bloomberg, NY, USA. It ranks 60 countries in terms of its ability to innovate its products and services (Bloomberg, 2020 ). Knowledge products are products created by knowledge or intellectual capital, and they are at the stage ready to be commercialized for personal enjoyment. They are proxied by two indexes: Patents granted and Trademarks in force. The indexes are published by the World Intellectual Property Organization (WIPO, 2020 ), Geneva, Switzerland. These indexes are by no means the best, but they are readily available. For instance, Tech-strength Index and the Innovation Index ranked certain countries far too high and certain countries too low. For instance, for Tech-Strength Index, Singapore is ranked eight, way ahead of Germany and South Korea and for Innovation Index, and UAE is ranked eight against powerhouse Japan and Taiwan (China).

We agree that other approaches or methodologies and other proxies may be used in ascertaining a knowledge economy, and this is an interesting avenue to explore. The selected countries illustrating knowledge economies are tabulated used for in Table ​ Table5 5 .

The selected countries and their associated indexes that proxied the elements of knowledge economy

GDP Per capital Nominal 2020 est. International Monetary Fund, Washington DC. Social Progress Index, 2020, Social Progress Imperative, US. Tech Strength, 2020, Global Finance, NY. World Global Innovation Index 2020, World Intellectual Property Organization (WIPO), Geneva, Switzerland. *Ranked by Bloomberg, 2020. World Patent Grants, 2019, Statista, NY, World Intellectual Property Organization (WIPO), Geneva, Switzerland. World trademarks in force, 2019, World Intellectual Property Organization (WIPO), Geneva, Switzerland

Although Qatar has the high per-capita GDP, it does not meet many of the requirements of a social economy (fail to satisfy most of the four elements) and so we exclude it for our analysis. We also exclude some other high-income countries/jurisdictions such as Macau (China), Ireland, Brunei, Kuwait, Bahamas, Malta and San Marino because of its small population. While Hong Kong (China), Singapore, Ireland and Iceland have high income and sufficiently high human capital, they lack knowledge and innovation to generate their own knowledge products, and hence they are not selected for consideration of knowledge economies. Oman, Spain, New Zealand, Poland and Hungary may have fairly high technology usage, but most of their knowledge products are imported. Russia and China are not high-income countries but are included for comparison purposes because of their strength in generating knowledge products. Although the USA has high GDP and certain good knowledge economy rating, it has many social problems such as income disparity between cities, high racialism, high crime rates, poor health care and unequal usage of IT, and hence, it does not meet the knowledge economy criteria. Also excluded are Saudi Arabia and Bahrain (poor social progress, poor innovation and poor IP data). So the apparent knowledge economy countries appear to relate to Luxembourg, Australia, the Netherlands, Sweden, Finland, Germany, Canada, Israel, France, UK, Japan, South Korea, Taiwan (China) and Lithuania. But the inability to control the Covid-19 pandemic has dented some of these countries from being an apparent knowledge economy. Of the countries selected, only China managed to have the pandemic under control but its moderate GDP and low social progress have dampened her to be a candidate of apparent knowledge economy. Therefore, it appears that only Luxembourg, Australia, Finland, South Korea, Taiwan (China) and Lithuania satisfy the knowledge economy criteria.

Conclusions and Discussion

Despite nearly 58 years since the term knowledge economy first appears, we are no nearer in understanding this new kind of economy. This lack of understanding is exacerbated as there is no universal acceptance of the definition of knowledge , knowledge creation, knowledge economy , knowledge society , service economy , network society , etc., and various associated terms such as knowledge, knowledge creation and socialization. Thus, as a result, significant doubts are caused concerns as to whether the ‘modern economies’ are, indeed, ‘knowledge economies’. It does not follow that only those countries transformed to servicing industries and to creating ‘knowledge’ in so-called knowledge work (white-collared jobs) will thrive to be transformed into knowledge economies. More critically, the current economic meltdown of these so-called knowledge economies is testimonies of false assertion by the precursors of the field. Such inadequacy occurs in view of the fact that the field has no shortage of writers and critics that advance or reject various avenues of the knowledge economy.

In this study, we have made a thorough examination of what the precursors have written about the knowledge economy and what the commenters have argued to put forward what a knowledge economy ought to be. The notion of the knowledge economy must be viewed from some phenomena that have transformed the contemporary economy, but in our content and critical analyses, none of the precursors has advocated an economic system that deals with the fundamentals of the factors of production and how these factors influence society. We, however, found that the works of Nonaka and Takeuchi received some favourable commentaries and we consider that they had initiated a difficult paradigm of articulating tacit knowledge in the conception of knowledge in knowledge creation (management) which if properly transferred (applied) among knowledge workers would lead to the sustaining of competitive advantage of firms and the collective effort of firms would enable the country to prosper in the future.

This study finds that the study of the knowledge economy is largely speculative where each precursor prescribes what knowledge, information or network ought to be, and suggests a particular economic system (society) that the precursor opines to be appropriate to be used in a particular time period. As such, the field has not been developed into a coherent study of social-economic knowledge, innovation thoughts and technology and knowledge products. Nevertheless, we found the field is interesting and has research usefulness. We achieve three major findings and hence offer these suggestions.

• We do not need the multiplicity of terms to describe one thing (subject matter); all we need is to use the caption ‘knowledge economy’ in describing the contents of this new form of economy—i.e. by adopting the path of science, we define the field by its theory, not term. We see the term ‘knowledge economy’ and ‘knowledge society’ to be synonymous as an economy that utilizes knowledge to transform work into knowledge products progresses to become a knowledge economy. Likewise, knowledge workers who have successfully developed knowledge products would like to have personal enjoyment.
• Using the notion of common ground, we articulate that the theoretical foundation of the knowledge economy is (1) a branch of social economy where the starting point is the mid-1990s and (2) not really an economy based solely on production and consumption by exploiting labour and capital, but it is based more on social values, technology and knowledge and innovation to commercialize knowledge products.
• Using a novel methodology based on proxies, we found that our defined knowledge economy countries are those that satisfy the four criteria: sociability, high-technology adoption, possession of knowledge and innovation to produce knowledge products rather than merely having a high income or apparent high level of social progress, tech strength or innovation. We find tech-strength and innovation indexes wanting, but nevertheless, we include them in our analysis as data to proxy for technology and innovation is hard to come by.

As there is disparity in wealth, employment prospect, social equality, technology availability, innovation, education level and mindset in different countries or regions within a country, our defined knowledge economy can only be found in a few countries.

Acknowledgements

We would like to express our thanks of gratitude to the editor, Prof Elias G. Carayannis, Editor-in-Chief, for his comments as well as an anonymous reviewer who have for their insightful suggestions and careful reading of the manuscript.

Publisher’s Note

Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.

• Abdulla RA. The Internet in the Arab World. Germany: Peter Lang Publishing; 2007. [ Google Scholar ]
• Aghion P, Blundell R, Griffith R, Howitt P, Prantl S. Entry and productivity growth: Evidence from microlevel panel data. Journal of the European Economic Association. 2004; 2 (2&3):265–276. doi: 10.1162/154247604323067970. [ CrossRef ] [ Google Scholar ]
• Allagui, I. (2009). Multiple mirrors of the Arab digital gap. Global Media Journal (online) 8(4).
• Allal-Chérif O, Makhlouf M. Using serious games to manage knowledge: The SECI model perspective. Journal of Business Research. 2016; 69 (5):1539–1543. doi: 10.1016/j.jbusres.2015.10.013. [ CrossRef ] [ Google Scholar ]
• Apte, U. M., Nath, H. K. (2004). Size, structure and growth of the US Information Technology. Southern Methodist Church and Sam Houston State University.
• Arrow KJ. The economics of information. Cambridge, MA: Harvard University Press; 1984. [ Google Scholar ]
• Bankwatch. (2017) Broken rivers. The impacts of European-financed small hydropower plants on pristine Balkan landscapes. https://bankwatch.org/wp-content/uploads/2017/12/broken-rivers.pdf . Accessed on 12 Dec 2020.
• Bell D. The coming of post-industrial society: A venture in social forecasting. New York: Basic Books; 1973. [ Google Scholar ]
• Bell D. The coming of post-industrial society: A venture in social forecasting. London: Heinemann; 1974. [ Google Scholar ]
• Bell D. The social framework of the information society. In: Dertoozos ML, Moses J, editors. The computer age: A 20 year view. Cambridge, MA: MIT Press; 1979. pp. 500–549. [ Google Scholar ]
• Bell, D. (1980). The winding passage: Essays and sociological journeys, 1960-1980. Cambridge, Massachusetts: Abt Books.
• Berners-Lee, T. (2010). Long live the web: A call for continued open standards and neutrality. Scientific American 11. [ PubMed ]
• Besley T, Dewatripont M, Guriev S. Transition and transition impact: A review of the concept and implications for the EBRD. London: European Bank for Reconstruction and Development; 2020. [ Google Scholar ]
• Bloomberg Innovation Index. (2020). Bloomberg, NY, https://www.bloomberg.com/graphics/2015-innovative-countries/ . Accessed on 22 Dec 2020.
• Brown, L. (2008). Mount Saint Vincent University, social economy and sustainability research network (Partenariat sur l’economie sociale et la durabilite), http://www.msvu.ca/socialeconomyatlantic/ english/whatisE.asp. Accessed on 26 Dec 2015.
• Castells, M. (1996). The net and the self: working notes for a critical theory of the informational society. Critique of Antropology.  Sage: London.
• Castells M. The power of identity, the information age: Economy, society and culture. Cambridge, MA: Wiley-Blackwell; 1997. [ Google Scholar ]
• Castells M. Materials for an exploratory theory of the network society. British Journal of Sociology. 2000; 51 (1):5–24. doi: 10.1080/000713100358408. [ CrossRef ] [ Google Scholar ]
• Castells M. The rise of the network society. 2. U.S.: Blackwell Publishing; 2000. [ Google Scholar ]
• Castells, M. (2010). End of millennium, the information age: Economy, society and culture Vol. III. 2nd. Edition, Wiley-Blackwell, Cambridge, MA.
• Chae B, Bloodgood J. The paradoxes of knowledge management: An eastern philosophical perspective. Information and Organization. 2006; 16 (1):1–26. doi: 10.1016/j.infoandorg.2005.06.003. [ CrossRef ] [ Google Scholar ]
• Choo WC. The knowing organization: How organizations use information to construct meaning, create knowledge and make decisions. Oxford: Oxford University Press; 1998. [ Google Scholar ]
• Choong KK. Intellectual capital: Definitions, categorization and reporting models. Journal of Intellectual Capital. 2008; 9 (4):609–638. doi: 10.1108/14691930810913186. [ CrossRef ] [ Google Scholar ]
• Choong, K. K. (2014). Has this large number of performance measurement publications contributed to its better understanding? A systematic review for research and applications. International Journal of Production Research, 52 (14), 4174–4197.
• Conklin D. Comparative economic systems. Cambridge: Cambridge University Press; 1991. [ Google Scholar ]
• Connell CM. Fritz Machlup’s methodology and the theory of the growth of the firm. Quarterly Journal of Austrian Economics. 2007; 10 (4):300–312. doi: 10.1007/s12113-007-9021-3. [ CrossRef ] [ Google Scholar ]
• Cornish, E. (2011). Daniel Bell and the post-industrial society. Futurist, The.FindArticles.com, http://findarticles.com/ . Accessed on 13 Oct 2014.
• Davenport TH. Thinking for a living: How to get better performance and results from knowledge workers. Boston: Harvard University Press; 2005. [ Google Scholar ]
• Davenport TH, Glaser J. Just-in-time delivery comes to knowledge management. Harvard Business Review. 2002; 80 (7):107–111. [ PubMed ] [ Google Scholar ]
• Davenport, T. H., & Prusak, L. (1998). Working knowledge: How organizations manage what they know. Harvard Business School Press, Boston.
• Davenport, T. H., & Prusak, L. (2000). Working knowledge: How organizations manage what they know. Harvard Business School Press: Boston.
• Davenport TH, Volpel SE. The rise of knowledge towards attention management. Journal of Knowledge Management. 2001; 5 (3):212–221. doi: 10.1108/13673270110400816. [ CrossRef ] [ Google Scholar ]
• Demoustier D. Social economy as social science and practice: Historical perspectives on France. Eleventh World Congress of Social Economics Social Economics: A Paradigm for a Global Society, Albertville, France, June; 2004. pp. 8–11. [ Google Scholar ]
• Desouza KC, Awazu Y, Jha S, Dombrowski C, Papagari S, Baloh P, Kim JY. Customer-driven innovation — To be a marketplace leader, let your customers drive. Research Technology Management. 2008; 51 (3):35–44. doi: 10.1080/08956308.2008.11657503. [ CrossRef ] [ Google Scholar ]
• Di Maggio, P., Celeste, C. (2004). Technological careers: Adoption, deepening and dropping out in a panel of Internet users, Working paper, Princeton University.
• Drucker, P. (1969). The age of discontinuity. Butterworth-Heinemann: Oxford.
• Drucker, P. (1973). Butterworth-Heinemann, Harper & Row: New York.
• Drucker, P. (1999). Management challenges for the 21st century. Harper Business: New York.
• Drucker P. The Age of Discontinuity. N Y: Guidelines to our changing society. Harper & Row; 1992. [ Google Scholar ]
• Drucker P. Managing for the future: The 1990s and beyond. Oxford: Butterworth-Heinemann; 1992. [ Google Scholar ]
• Drucker P. Post-capitalist society. Oxford: Butterworth-Heinemann; 1993. [ Google Scholar ]
• Edersheim EH. The definitive Drucker. NY: McGraw-Hill; 2007. [ Google Scholar ]
• Eissa, N. (2020). Pandemic preparedness and public health expenditure. The Economics of Health Outbreaks and Epidemics . July.
• Engelbrecht HJ. A comparison and critical assessment of Porat and Rubin’s information economy and Wallis and North’s transaction sector. Information Economics & Policy. 1997; 9 :271–290. doi: 10.1016/S0167-6245(97)00011-5. [ CrossRef ] [ Google Scholar ]
• European Bank for Reconstruction and Development. (2019). European Bank for Reconstruction and Development. London.
• Fuchs, C. (2009). Some reflections on Manuel Castells’s book Communication Power. Creative Common License 7(1), 94–108. http://www.triple-c.at
• Garnham, N. (2004a). Information society theory as ideology. In Webster, F., (Ed.), The information society reader, Routledge, NY.
• Garza-Rodriguez J, Almeida-Velasco N, Gonzalez-Morales S, et al. The impact of human capital on economic growth: the case of Mexico. Journal of the Knowledge Economy. 2020; 11 :660–675. doi: 10.1007/s13132-018-0564-7. [ CrossRef ] [ Google Scholar ]
• Giddens A. The consequences of modernity. Cambridge: Polity; 1990. [ Google Scholar ]
• Giddens A. Sociology. 4. Maidenhead: Polity Press; 2001. [ Google Scholar ]
• Global Finance. (2020, May 7). The 2020 World’s Best Innovators. New York. https://www.gfmag.com/awards-rankings/best-banks-and-financialrankings/worlds-best-innovators-2020
• Godin B. The new economy: What the concept owes to the OECD” Research Policy. 2004; 33 (5):679–690. doi: 10.1016/j.respol.2003.10.006. [ CrossRef ] [ Google Scholar ]
• Godin B. The knowledge-based economy: Conceptual framework or buzzwork? Journal of Technology Transfer. 2006; 31 (1):17–30. doi: 10.1007/s10961-005-5010-x. [ CrossRef ] [ Google Scholar ]
• Godin, B. (2008). The knowledge economy: Fritz Machlup’s construction of a synthetic concept. In Viale, R., Etzkowitz, H., (Eds.), The capitalization of knowledge . Edward Elgar Publishing, Cheltenham, Glos, UK and Northampton, MA.
• Godin, B. (2010). The culture of numbers: From science to innovation. Talk Given to the Government-University-Industry Research Roundtable (GUIRR), US National Academy of Sciences, Washington, 21 May, 2010, GUIRR Leadership Dinner.
• Gorz A. Farewell to the working class. NY: Pluto Press; 1982. [ Google Scholar ]
• Gourlay S. Conceptualizing knowledge creation: A critique of Nonaka's theory. Journal of Management Studies. 2006; 43 (7):1415–1436. doi: 10.1111/j.1467-6486.2006.00637.x. [ CrossRef ] [ Google Scholar ]
• Gueslin A. L’invention de l’e ´conomie sociale. Paris: Economica; 1987. [ Google Scholar ]
• Hadad S. Knowledge economy: Characteristics and dimensions. Management Dynamics in the Knowledge Economy. 2017; 5 (2):203–225. doi: 10.25019/MDKE/5.2.03. [ CrossRef ] [ Google Scholar ]
• Hildreth, P. J., Kimble, C. (2002). The duality of knowledge . Information Research 8(1). Available at http://InformationR.net/ir/8-1/paper142.html
• Hodder I. The interpretation of documents and material culture. Thousand Oaks etc.: Sage; 1994. [ Google Scholar ]
• Horkheimer M. Critical theory. NY: Seabury Press; 1982. [ Google Scholar ]
• Houghton, J., Sheehan, P. (2000). A primer on the knowledge economy. Unpublished Manuscript, Victoria University, Australia.
• Huarng K, Mas-Tur A. Turning Kurt Lewin on his head: Nothing is so theoretical as a good practice. Journal of Business Research. 2016; 69 (11):4725–4731. doi: 10.1016/j.jbusres.2016.04.022. [ CrossRef ] [ Google Scholar ]
• ICTE Solutions, Australia. (2020). The benefits of technology in education. https:// www.ictesolutions.com.au/the-benefits-of-technology-in-education/ . Accessed on 2020-December-26.
• Institute for Strategy and Competitiveness. (2020). Harvard Business School, https://www.isc.hbs.edu/research-areas/pages/social-progress-index.aspx . Accessed on 26 Dec 2020.
• Isenberg, D. (2010). Oct 4, The myth of the knowledge economy , Economist, London.
• Jones, C. (2019 Dec). 1 2 Critical types of content analysis. Content Science. Review. https://review.content-science.com/2-critical-types-of-content-analysis/
• Jorna, R. (1998). Managing knowledge. Semiotic Review of Books 9 (2). http://www.chass.utoronto.ca/epc/srb/srb/managingknow.html . Accessed on 2011-April-12.
• Kitchenham, B. A., & Charters, S. (2007). Guidelines for performing systematic literature reviews in software engineering, Technical Report EBSE-2007-01. School of Computer Science and Mathematics, Keele University.
• Krippendorff K. Content analysis: An introduction to its methodology. Thousand Oaks, CA: Sage; 2004. [ Google Scholar ]
• Kupers W. Phenomenology of embodied implicit and narrative knowing. Journal of Knowledge Management. 2005; 9 (6):114–133. doi: 10.1108/13673270510630006. [ CrossRef ] [ Google Scholar ]
• Lages, L. VCW—Value creation wheel: Innovation, technology, business, and society, Journal of Business Research , 69(11), 4849–4855.
• Leseure, M, Bauer, J, Birdi, K, Neely, A, & Denyer, D. (2004). Adoption of promising practices: a systematic review of the evidence. International Journal of Management Review, 5-6 (3-4), 169-190.
• Lettl C, Herstatt C, Gemünden HG. Users’ contributions to radical innovation: Evidence from four cases in the field of medical equipment technology. R&D Management. 2006; 36 (3):251–272. doi: 10.1111/j.1467-9310.2006.00431.x. [ CrossRef ] [ Google Scholar ]
• Lynch R, Jin Z. Knowledge and innovation in emerging market multinationals: The expansion paradox. Journal of Business Research. 2016; 69 (5):1593–1597. doi: 10.1016/j.jbusres.2015.10.023. [ CrossRef ] [ Google Scholar ]
• Machlup F. The production and distribution of knowledge in the United States. Princeton, NJ: Princeton University Press; 1962. [ Google Scholar ]
• Machlup F, Mansfield U. The Study of information: Interdisciplinary messages. NY: John Wiley and Sons; 1970. [ Google Scholar ]
• Mackay H. Investigating the information society. London: Routledge; 2001. [ Google Scholar ]
• Miles, I. (1990). Mapping and measuring the information economy. Library and Information Research Report 77, British Library Board, London.
• Moulaert F, Ailenei O. Social economy, third sector and solidarity relations: A conceptual synthesis from history to present. Urban Studies. 2005; 42 (11):2037–2053. doi: 10.1080/00420980500279794. [ CrossRef ] [ Google Scholar ]
• Muriel, O., Serrat, O. (2009).  Disseminating Knowledge Product , Knowledge Solutions, April, Asian Development Bank, Manila.
• Nakata N. Indigenous knowledge and the cultural interface: Underlying issues at the intersection of knowledge and information systems. IFLA Journal. 2002; 28 (5):281–291. doi: 10.1177/034003520202800513. [ CrossRef ] [ Google Scholar ]
• Neslen, A. (2015 December 11). "Major banks put up nearly €1bn for controversial Balkan dams, says report". The Guardian. Accessed on 2020-December-26.
• Ninacs, W. with assistance from M. Toye. (2002). A review of the theory and practice of social economy / Économie Sociale in Canada SRDC Working Paper Series 02–02, Ottawa, Canada.
• Nasioulasa I, Marisb N. Toward the digital social economy: Institutionalizing collective action in the ever­evolving web. Sociology Study. 2011; 1 (5):340–345. [ Google Scholar ]
• Nonaka I. The knowledge creating company. Harvard Business Review. 1991; 69 (1):96–104. [ Google Scholar ]
• Nonaka I. A Dynamic theory of organizational knowledge creation. Organizational Science. 1994; 5 (1):14–37. doi: 10.1287/orsc.5.1.14. [ CrossRef ] [ Google Scholar ]
• Nonaka I, Takeuchi H. The knowledge creating company: How Japanese companies create the dynamics of innovation. NY: Oxford University Press; 1995. [ Google Scholar ]
• Nonaka I, von Krogh G. Perspective-tacit knowledge and knowledge conversion: Controversy and advancement in organizational knowledge creation theory. Organization Science. 2009; 20 (3):635–652. doi: 10.1287/orsc.1080.0412. [ CrossRef ] [ Google Scholar ]
• Norris, P. (2001). Digital divide. Civic engagement, information poverty, and the Internet worldwide. USA : Cambridge University Press
• O’Donovan N. From knowledge economy to automation anxiety: A growth regime in crisis? New Political Economy. 2020; 25 (2):248–266. doi: 10.1080/13563467.2019.1590326. [ CrossRef ] [ Google Scholar ]
• Oberg C. Customer roles in innovations. International Journal of Innovation Management. 2010; 14 (6):989–1101. doi: 10.1142/S1363919610002970. [ CrossRef ] [ Google Scholar ]
• Organisation for Economic Co-operation and Development (OECD). (1995a). Economic Outlook, Volume 1995 Issue 1. OECD, Paris.
• Organisation for Economic Co-operation and Development (OECD). (1995b). Economic Outlook, Volume 1995 Issue 2. OECD, Paris.
• Organisation for Economic Co-operation and Development (OCED). (1996a). The knowledge-based economy. OECD/GD (96) 102, OECD. Paris.
• Organisation for Economic Co-operation and Development (OCED). (1996b). Measuring what people know: Human capital accounting for the knowledge economy . OECD, Paris: OECD/DSTI/ICCP.
• Organization for Economic Cooperation and Development (OECD). (1996c). National innovation systems: Proposals for phase II. DSTI/STP/TIP(96)11, OECD, Paris.
• Organization for Economic Cooperation and Development (OECD). (1996d). The knowledge-based economy . OECD, Paris: STI Outlook.
• Organization for Economic Cooperation and Development (OECD) Technology. Best Policy Practice, OECD, Paris: productivity and job creation; 1998. [ Google Scholar ]
• Organization for Economic Cooperation and Development (OECD) A new economy: The changing role of innovation and information technology in growth. Paris: OECD; 2000. [ Google Scholar ]
• Organization for Economic Cooperation and Development (OECD) OECD Information Technology Outlook. Paris: OECD; 2004. [ Google Scholar ]
• Organisation for Economic Co-operation and Development (OECD) Innovation Today – Intangible Assets are based on COINVEST. Paris: OECD; 2010. [ Google Scholar ]
• Organization for Economic Cooperation and Development (OECD). (2015) L'Organisation de coopération et de développement économiques, The Social Economy: Building Inclusive Economies, http://www.oecd.org/fr/cfe/leed/thesocialeconomybuildinginclusiveeconomies.htm
• Ormerod P. Butterfly economics. London: Faber; 1997. [ Google Scholar ]
• Oxley, L., Walker, P., Thorns, D., Wang, H. (2007). Exploring the knowledge economy/society: Another example of measurement without theory. Working Paper, University of Canterbury.
• Parkinson CN, Rustomji MK, Sapre SA. Peter Drucker: A critical commentary on his philosophy of management. Bombay: India Book House; 1987. [ Google Scholar ]
• Pawlowski J, Bick M. The global knowledge management framework: Towards a theory for knowledge management in globally distributed settings. The Electronic Journal of Knowledge Management. 2012; 10 (1):92–108. [ Google Scholar ]
• Peter G. Peterson Foundation. (2020). How does the U.S. Healthcare System compare to other countries? https://www.pgpf.org/blog/2020/07/how-does-the-us-healthcare-system-compare-to-other-countries . Accessed on 24 Dec 2020.
• Phillips, F., Yu, C. Y., Hameed, T., & El Akhdary, M. (2017). The knowledge society’s origins and current trajectory. International Journal of Innovation Studies, 1 (2), 175–191.
• Polanyi M. Personal knowledge: Towards a post-critical philosophy. Chicago, IL: University of Chicago Press; 1958. [ Google Scholar ]
• Polanyi M. The tacit dimension. London: Routledge and Kegan Paul; 1966. [ Google Scholar ]
• Porat MU. The information economy: Definition and measurement. Washington DC: United States Department of Commerce; 1977. [ Google Scholar ]
• Porat, M. U., Rubin, M. R. (1977). The information economy. Office of Telecommunications Special Publication 77-12, United States Department of Commerce, Washington DC.
• Powell W, Snellman K. The knowledge economy. Annual Review of Sociology. 2004; 30 (2):199–220. doi: 10.1146/annurev.soc.29.010202.100037. [ CrossRef ] [ Google Scholar ]
• Rahimi E, Rostami NA, Shad FS, Vafaei V. The importance of knowledge management on innovation. Applied mathematics in engineering, management and technology. 2017; 5 (1):68–73. [ Google Scholar ]
• Rice RE, Haythornthwaite C. Perspectives on Internet use: Access, involvement and interaction. In: Lievrouw LA, Livingstone S, editors. Handbook of new media: Social shaping and social consequences of ICTs (Updated. student. London: Sage; 2006. pp. 92–113. [ Google Scholar ]
• Rim G, Kim G, Hwange S, et al. Some problems in statistically assessing the level of knowledge economy. Journal of Knowledge Economy. 2019; 10 :974–996. doi: 10.1007/s13132-017-0510-0. [ CrossRef ] [ Google Scholar ]
• Roberts J. The global knowledge economy in question. Critical Perspectives on International Business. 2010; 5 (4):285–303. doi: 10.1108/17422040911003033. [ CrossRef ] [ Google Scholar ]
• Robins K, Webster F. Times of the technoculture: From the information society to the virtual life. London: Routledge; 1999. [ Google Scholar ]
• Robinson PN, Bauer S. Introduction to bio-ontologies. Boca Raton, FL: CRC Press, Taylor & Francis Group LLC; 2011. [ Google Scholar ]
• Rooney D, Hearn G, Niriam A, editors. Handbook on the knowledge economy. Cheltenham, Glos, UK: Edward Elgan Publishing; 2005. [ Google Scholar ]
• Rooney, D. Hearn, G., & Kastelle, T. (2012). Knowledge is people doing things, knowledge economies are people doing things with better outcomes or more people. In Handbook on the knowledge economy, volume two. Rooney, D. Hearn, D. & Kastelle (eds), T. Edward Elgar Publishing, Cheltenham, UK.
• Rosker, R. (2014). Epistemology in Chinese philosophy. Stanford Encyclopedia of Philosophy. https://plato.stanford.edu/entries/chinese-epistemology/ . Accessed on 2 May 2017.
• Sapru RK. Administrative thesis and management thought. New Delhi: Practice Hall India; 2008. [ Google Scholar ]
• Sarkar PR. revised in 2012. Ananda Marga-Ananda Printers, Kolkata, India: Idea and Ideology; 1959. [ Google Scholar ]
• Sharma R, Ng E, Dharmawirya M, Lee C. Beyond the digital divide: A conceptual frame work for analyzing knowledge societies. Journal of Knowledge Management. 2008; 12 (5):151–164. doi: 10.1108/13673270810903000. [ CrossRef ] [ Google Scholar ]
• Shield, S. (2020). The EBRD, fail forward neoliberalism and the construction of the European periphery. The Economic and Labour Relations Review . April. https://journals.sagepub.com/doi/full/10.1177/1035304620916652 . Accessed on 26 Dec 2020.
• Smith MK. What is the ‘knowledge economy’? Knowledge Intensity and Distributed Knowledge Bases: United Nations University, Institute for New Technologies; 2002. [ Google Scholar ]
• Styhre A. Understanding knowledge management: Critical and postmodern perspectives. Copenhagen: Copenhagen Business School Press; 2003. [ Google Scholar ]
• Swan J, Scarborough H. The paradox of ‘knowledge management’ Informatik Informatique. 2002; 1 :10–13. [ Google Scholar ]
• The Straits Times. (2020 October 16). Bid to fix fault led to disruption of 3 MRT lines.  https://www.straitstimes.com/singapore/bid-to-fix-fault-led-to-disruption-of-3-mrt-lines . Accessed on 26 Dec 2020.
• UNESCO. (2003). Towards knowledge societies. (by Abdul Waheed Khan (General sub-director of UNESCO for ¬Communication and Information)). In A World of Science 1(4), United Nations Educational, Scientific and Cultural Organizations, Paris. http://www.unesco.org/science/world_sc_july03.pdf . Accessed on 17 Oct 2017.
• UNESCO . Towards knowledge societies. United Nations Educational: Scientific and Cultural Organizations (UNESCO) Publishing, Paris; 2005. [ Google Scholar ]
• Van Dijk, J. (1999). The network society: Social aspects of new media . Thousand Oaks, London (original Dutch edition, 1991, De netwerkmaastchappij Bohn Staflen Van Loghum, Houten).
• Van Dijk J. The network society: Social aspects of new media. London: Thousand Oaks; 2006. [ Google Scholar ]
• Von Krogh G, Ichijō K, Nonaka I. Enabling knowledge creation: How to unlock the mystery of tacit knowledge and release the power of innovation. NY: Oxford University Press; 2000. [ Google Scholar ]
• Von Krogh G, Nonaka I, Nishiguchi T. Knowledge creation: A source of value. NY: Palgrave Macmillan; 2000. [ Google Scholar ]
• Wang, J. (2018). Innovation and government intervention: A comparison of Singapore and Hong Kong. Research Policy, 47 (2),399–412.
• Waters M. Daniel Bell – A critical but favorable intellectual biography. London: Routledge; 1996. [ Google Scholar ]
• Webster F. Theories of the information society. 2. London: Routledge; 2002. [ Google Scholar ]
• Webster F. The information society revisited. In: Lievrouw L, Livingstone S, editors. Handbook of New Media. London: Sage; 2002. pp. 255–266. [ Google Scholar ]
• Webster F. Information and urban change: Manuel Castells. In: Webster F, Dimitriou B, editors. Manuel Castells - London: Sage Publications; 2004. pp. 15–39. [ Google Scholar ]
• Wellenius, B. (1988). Foreword: Concepts and issues on information sector measurement. In: Jussawalla, M., Lamberton, D., Karunaratne, N., (Eds.), The cost of Thinking: Information Economics of Ten Pacific Countries. Ablex, Norwood, NJ.
• Wilson, T. D. (2002). The nonsense of ‘knowledge management’. Information Research 8 (1), available at http://InformationR.net/8-1 . Retrieved 12 May 2011.
• World Bank. (2020). Current health expenditure (percentage of GDP). https://data.worldbank.org/indicator/SH.XPD.CHEX.GD.ZS . Washington DC. Accessed on 22 Dec 2020.
• World Intellectual Property Organization Statistics. (2020). World Intellectual Property Organization (WIPO), Geneva, Switzerland, http://www.wipo.int/ipstats/en/ . Accessed on 22 Dec 2020.
• ZDNet. (2020). Singapore government ups ICT spending by 30% to fuel post-pandemic recovery, digital transformation. https://www.zdnet.com/article/singapore-government-ups-ict-spending-by-30-to-fuel-post-pandemic-recovery-digital-transformation/ . Accessed on 26 Dec 2020.
• Zhu AYF, Chou KL. Hong Kong’s transition toward a knowledge economy: Analyzing effect of overeducation on wages between 1991 and 2011. Journal of the Knowledge Economy. 2020; 11 :103–113. doi: 10.1007/s13132-018-0535-z. [ CrossRef ] [ Google Scholar ]

A business journal from the Wharton School of the University of Pennsylvania

Life After Prison: Why Returning Citizens Become Entrepreneurs

April 1, 2024 • 6 min read.

Research from Wharton’s Damon J. Phillips finds that people who have been incarcerated, especially Black men, seek entrepreneurship as an alternative to low wages and a lack of opportunity in traditional employment.

• Entrepreneurship
• Diversity, Equity, & Inclusion

People who have been incarcerated are more likely to turn to entrepreneurship after prison to overcome discrimination in the labor market, especially formerly incarcerated Black men who face the highest barriers to employment.

In his co-authored study , Wharton management professor Damon J. Phillips found that previously incarcerated individuals are 5% more likely to start their own business, compared with the general public. For Black men who have been incarcerated, entrepreneurship leads to higher incomes than traditional employment and less recidivism.

Phillips said the results of the study should be eye-opening for employers who distrust and discriminate against job applicants with a criminal past, and for policymakers allocating resources to help the imprisoned population.

The Reality of Life After Prison

“The set of stereotypes we have about people who have been incarcerated works against the goal of having a strong workforce,” Phillips said. “Given that almost a third of adults have some form of criminal record, the health of the economy and public safety is improved when you provide employment opportunities for these citizens.”

The paper was co-authored by Kylie Jiwon Hwang , management and organizations professor at Northwestern University’s Kellogg School of Management. The scholars believe it is the first study to investigate entrepreneurship as a response to labor market discrimination for those with criminal records.

“It’s not just an entrepreneurship story, it’s an employment story.” — Damon J. Phillips

Phillips credits Hwang with coming up with the research focus when she was his doctoral student several years ago. He was leading a program to provide business education in prisons outside New York City, and she was interested in studying systemic inequality in the labor market, especially for stigmatized people such as those with criminal records. The scholars came to understand a common refrain from currently and formerly incarcerated people: They wanted to know how to start their own businesses, because they knew that what awaited them after prison was a paucity of low-wage, high-risk jobs limited to industries such as construction or the service industry.

“We’d talk to these focus groups, and they would tell us that their favorite show is ‘Shark Tank,’” Phillips said, referring to the entrepreneurial TV series. “The idea for the study wasn’t to show how entrepreneurship was a viable alternative, it was to test and question whether it was.”

Returning Citizens Often Cast Aside by Employers

Armed with plenty of anecdotes, the scholars set out to find evidence. They analyzed data from the U.S. Longitudinal Survey of Youth along with data from the National Employment Law Project on ban-the-box policies. Known as the Fair Chance Act , these policies prohibit employers from conducting criminal background checks until later in the application process.

In jurisdictions with a ban-the-box policy, formerly incarcerated Black men were the only group less likely to become entrepreneurs. That finding is consistent with the idea that the severity of labor market discrimination is experienced to a greater extent by Black men, who are incarcerated at significantly higher rates than any other group.

Phillips acknowledged that employers may have understandable concerns about hiring returning citizens, including public relations. But he said there is a business case for not “leaving talent on the table” and giving them opportunities to add value to their employers.

Phillips said the study points to a need for more education and support for returning citizens wanting to start a business, such as helping them write a strong business plan or increasing their access to capital. It’s also a call for companies to think about their procurement rules and consider vendors and contractors who were once imprisoned.

“The set of stereotypes we have about people who have been incarcerated works against the goal of having a strong workforce.” — Damon J. Phillips

The professor emphasized that entrepreneurship is difficult and fraught, with failure for any venture as a common outcome. Prescribing it to a marginalized population should be done with caution and an understanding of the labor market opportunities that this population may face.

“In a better world, people with criminal records have better job opportunities, education and training so that if they start a business, they are starting them because they really want to,” Phillips said. “Until we get to that better world, we owe it to them – and society – to help them start businesses when it is the best option for them.”

One of the paper’s most noteworthy findings is on recidivism: Returning citizens who become entrepreneurs are much less likely to return to prison, even when compared with their cohort peers in traditional employment. The research doesn’t identify exactly why, but Phillips and Hwang think it has to do with better wages, greater stability, and a sense of community pride that comes with entrepreneurship.

“Some of that, we believe, is about the dignity of work,” Phillips said. “I do think there are distinct advantages associated with entrepreneurship, especially for a population that is stigmatized. But it’s not just an entrepreneurship story — it’s an employment story.”

The Bigger Policy Picture

In 2022, Phillips was invited to testify before a U.S. Senate committee hearing on entrepreneurship among formerly incarcerated people. With nearly 1.8 million behind bars, the U.S. tops the world for the number of people imprisoned and ranks sixth for the rate of incarceration relative to the population. It’s a topic with a lot of bipartisan overlap, Phillips said, but also considerable finger-pointing.

“There are important debates on how we got into the problem of mass incarceration in the first place,” he said. “But that’s not our research. We are business school scholars. Doing this from a business school perspective is helpful because business schools seek to offer pragmatic solutions. We’re really trying to develop solutions.”

Phillips and Hwang said their findings show how the issues of labor market discrimination and inequality need much more research, and they invite other scholars to build on their work.

“This study was informed by talking and working with people who are actually living through this,” Phillips said. “Kylie and I want other academics to read our study because we are hoping others will advance these kinds of topics.”

Phillips will be speaking at an upcoming conference, The Business Case for Second Chance Employment , hosted by the Wharton Coalition for Equity and Opportunity .

More From Knowledge at Wharton

Challenges for Women in the Workplace | Martine Haas

How Leadership Is Defined Differently for Women | Rebecca Schaumberg

Why Startup Accelerators Are an Engine for Economic Growth

Looking for more insights.

Sign up to stay informed about our latest article releases.