TABLE OF CONTENTS Economic theory has a problem with knowledge;
it seems to defy the basic economic principle of scarcity
The more you use it and pass it on,
The more it proliferates
Infinitely expansible.
What is scarce in the new economy
Is the ability to understand and use knowledge.Survey of the World Economy [1]
I can still remember the day Ken Olsen (CEO of Digital at the time)insisted that we develop some management metrics as part of our company's transformation. "But sir," said we, "such measurements do not exist." "Yes," he responded, "and this is precisely why it must be addressed." We set about to research the potential metrics no small task. Of course, today, twelve years later, we understand that it is a matter of measuring intangible value; and, moreover, that there are multiple ways to do so!
Although there are earlier examples of the use of the term "intellectual premium" in the 1950s, my understanding is that John Kenneth Galbraith, an American economist born in Ontario, may be credited as one of the first, if not the first, to write about "intellectual capital" as a financial concept, as he did in 1969 [2], saying, "Intellectual Capital can be seen as a process of value creation in addition to an asset, an action more than just knowledge or pure intellect." Nobel Laureate Gary Becker, influenced...
