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ISC 14. Interpreting the 'Knowledge Economy' Cacophony: the extension of commodification to information production, dissemination and storage

Alex Nunn


Contemporary policy making and political debate displays a marked pre-occupation with the 'knowledge economy'. However, there is very little concrete consideration or popular consensus about the precise meaning of this or like terms. This short article contributes to an emerging literature which is beginning this process. It argues that the 'knowledge economy' is manifest in a multitude of ways, not all of them new. In particular it emphasises the effect of this revolution in the production, dissemination and storage of knowledge and information first in the crucial realm of Higher Education (HE) and then draws implications of this for public libraries. It highlights the 'new knowledge economy' rhetoric as an attempt to mask the reality which is the continuation of the extension of commodification too over more areas of life, to the point where even our own bodies may be the vehicle for capital accumulation. Thus the knowledge economy is an aspect of neo-liberal industrial restructuring and its constant attempts to overcome the contradictions within itself. However, after a consideration of some of the impacts of contemporary policy toward knowledge production, dissemination and storage, the article will conclude by suggesting that in commodifying knowledge and vital public services neo-liberal knowledge-based restructuring may be creating the conditions for its own demise. The article is short and its analysis limited by constraints of space. It therefore does not claim to be a comprehensive typology of the contemporary knowledge debate. Rather it proposes a particular avenue along which this debate might travel and shows how practical exemplification is necessary to give meaning to so many empty phrases.

The Contemporary Knowledge Cacophony

There is everywhere a preoccupation with the 'knowledge economy', 'knowledge revolution', 'information society', 'digital age'. Leaving aside newspaper headlines and simplistic pronouncements timed to coincide with millennial fever, these have been of central importance for policy makers at a variety of levels in the global political economy. The European Union has developed the Lisbon Strategy to create "the most dynamic knowledge based economy in the world" (European Commission [EC], 2001). Tony Blair "strongly believe[s] that the knowledge economy is our best route for success and prosperity" (Blair, 2000). Implied in these pronouncements is a vision of a post-modern post-industrial knowledge economy as "a new utopia, with collaborative knowledge workers enjoying intrinsically satisfying work, economic prosperity and democratic access to information" (Stanworth, 1998). The World Bank President argues that it is an opportunity to "bring equity to poor people throughout the world" (Wolfensohn, 2000). But amongst this cacophony of pronouncements about how we should seize the future and thrust ourselves into tomorrow's dynamic and prosperous world, there seems to be confusion about what exactly this knowledge-based economy is and how it differs from what has gone before it. However, through a glance at the policy developments that accompany such soundbites and by placing this 'knowledge cacophony' in its political, economic and historical context, it is possible to decipher the knowledge economy rhetoric to identify the key areas in its unfolding. In this regard it is argued that the 'knowledge cacophony' is actually an attempt to mask the reality of a continuation of capitalist social relations and the extension of commodification to ever more areas of social life.

The Knowledge Revolution: A Continuation of Advanced Industrial Restructuring

A dominant feature of the political, economic and social landscape over the last thirty years has been a continual process of industrial restructuring that has shifted the geographical balance of world production. Labour intensive aspects of production have been transferred from the advanced core of the global economy to production locations in Central and Latin America, East Asia, the Indian subcontinent, north Africa and since 1989 Eastern Europe and parts of the former Soviet Union. The prime motivation for this has been to bypass the embedded wage structures of unionised labour in the advanced core that had been able to sustain high wage rates during the immediate post-war period. By contrast, through taking advantage of the relative poverty and surplus of labour in the developing world, as well as the ability of authoritarian and centralised government's ability to suppress the local population, multinational industrial production was able to use relatively cheap labour in the developing world. This caused increasing unemployment and social conflict in the advanced core, perfectly witnessed by the industrial unrest of the early 1980s in the UK. It also therefore, necessitated a complimentary domestic industrial restructuring. Part of this project was manifest in the shift from heavy mass-production industry to light and service industries. So while production itself was relocated elsewhere in the world, aspects of the process were retained. In many cases these were the 'knowledge' aspects of production, such as financing, design, marketing, retail and services. In many respects the apparently 'new' knowledge economy represents a continuation, even completion of that 30 to 35 year old industrial restructuring project and is marked by the expansion of light and service industries.

The New Knowledge Industries

Within this larger medium-term restructuring project have been periods of rapid change mostly centred on the adoption and widespread (usually commercial) dissemination of technology. Thus the 1970s and 80s saw the rapid expansion of consumer electronics such as televisions, stereos, videos, compact disc players and domestic appliances such as automatic washing machines and microwaves. The same has also been true for the widespread dissemination of personal transport. During the late 1980s and 90s workplaces and homes have been transformed by the breathless development and dissemination first of Personal Computers and also Communications technology. The adoption of Information and Communications Technology into popular society over the last decade has truly transformed many social and workplace practices. The mere adoption of these technologies is hailed as an example of the knowledge economy and certainly the changes inherent in this process are part of what politicians are referring to when they use knowledge economy soundbites. However, it is questionable whether they in themselves constitute a qualitatively new knowledge-based economy. Most people's use of ICTs in the production process is no more knowledge-based than operating an industrial machine. Call centre operatives, office clerks and salespeople to name but a few examples, are all simply carrying out aspects of the production process aided by technological advancement. Furthermore, even the inventors, software programmers and technicians are not unparalleled in the history of capitalism. Rather, then this aspect of the knowledge economy represents no more than a continuation of mechanisation and innovation that has marked the dynamic history of capitalist development.

A connected but slightly different aspect of this 'knowledge revolution' is the exponential growth of media activity, which has been further spurred by the widespread adoption of the Internet. It is difficult, nowadays, to find an organisation, or public actor (be they corporate, other collective or individual) without a website, and increasingly these also integrate with other high technology media such as mobile phone text messaging and email. This can certainly make the world appear as if it is full of information and knowledge, immediately accepting that these two are not necessarily the same thing (Rikowski 2000a, 2000b). Certainly also, there is economic activity in this and again the politicians no doubt include this sector in their definitions of the knowledge economy. However, it does not represent a qualitatively new phenomenon. Information and knowledge have long been available through a variety of means and have long been commodified and sold commercially.

The Extension of the Commodification of Knowledge and Information in Industrial Restructuring

The most significant aspect of the new knowledge economy is the rapid and fundamental extension of commodification to areas and aspects of knowledge and information and their production, dissemination and storage not previously seen. The most dramatic expression of this is in the field of biotechnology where commodification has extended as far as aspects of human life itself in the form gene codes. Indeed the biotechnology industry is seen by the government as a key area in which to establish competitive advantage and as such one to target research funding on, especially in partnership with the private sector. If the creation of incentives for call centres and mobile phone assembly plants is the bottom end of the spectrum as far as 'New Labour's' knowledge economy industrial strategy goes, then the focus on biotechnology as a leading aspect of international research and design is the top end.

Related to this is one of the most shortsighted aspects of knowledge economy restructuring. As a result of four interrelated factors the government is targeting the production and dissemination of knowledge, particularly in HE, as the lynch pin of its knowledge economy strategy. In doing so it is making knowledge production and dissemination ever more dependant on the logic of capital accumulation.

First, HE, as with all public services, is the target of the continuation of the privatisation agenda as a result of an ideological belief that the market is the most effective and efficient management mechanism for the public sector. This is manifest plainly in Public Private Partnerships and in Private Finance Initiatives. However, in Higher Education it has also been manifest in the drastic reduction of state funding and in encouraging Universities to look for private sector sources of funding. The market mechanism has also been strengthened through attaching public funding to additional private finance and through only making it available on a short term and competitive basis. This has resulted in an increasingly managerial culture whereby financial and commercial priorities have been emphasised (HEFCE and CVCP, 2000).

Second, the widespread industrial change highlighted above has created problems associated with a highly flexible labour market in the UK, such as unemployment (particularly amongst the young) which in turn have other social problems attached to them such as ill health, rising crime and even social unrest. The UK government, alongside other OECD nations, is attempting to address this by making education more flexible and responsive to business needs to facilitate continuous and rapid retraining and reskilling of the labour force (Newby 2000). It is hoped that this will make the UK labour force attractive to foreign capital investment. This is demonstrated through a focus on life-long learning. Attempts to make HE provision responsive to market pressure, for instance through the use of short-term funding, the encouragement of partnerships with the private sector and the increasing prioritisation of vocational 'transferable' skills over broader critical and innovative thought development are also examples of this in HE.

At the highest of these, this includes funding for research in these 'knowledge' fields especially in partnership with the private sector (DFEE and DTI, 2001). At a lower level it includes a focus on equipping workers for a variety of employments in these industries and may involve a blurring of the distinction between Further Education (FE) and HE as witnessed in the creation of the Foundation Degree. The effect of these pressures can again be witnessed by the increasing focus being placed on the incorporation of vocational skills into HE provision and its expansion.

A slightly different perspective on 'knowledge-based' restructuring arises out of the intersection of industrial change, government responses to it and the dominance of the market paradigm in the organisation of those responses. Taken together these dynamics lead to education generally, and HE in particular, to be seen as a growth market opportunity which private enterprise might exploit for large and stable profit (Stokes, 2001). Thus part of the new knowledge economy is simply the redefinition of its production and dissemination as a profit making opportunity in and of itself.

A variety of private actors are watching the global market for education very carefully. A number of private firms are already involved in adult education and training through the establishment of corporate universities and through the offering of continuing for profit education in the commercial sector. Added to these directly interested corporations are venture capital firms such as who provide market intelligence to investors and seek to identify the opportunities for profitable investment in education markets. The interest of these firms was underlined in May 2001 at the World Education Market in Toronto where the liberalisation of education markets and the opportunities that it provides were a major topic of discussion for 1700 participants from 62 countries around the world (

Interest regarding labour market responsiveness and knowledge-based restructuring is not the sole concern of the UK government but is shared by many advanced industrial economies and even many emerging market economies, as well as regional bodies such as the EU in its aforementioned Lisbon Strategy. This means that there is a global demand for the services that can provide them which eduventures recently estimated to be in excess of US$105bn per year.1 The UK government perceives that the UK has a significant competitive advantage in this area through the high reputation of UK HE and the English language: the language of international business. Moves to establish a HEFCE funded e-university and moves by individual and collaborations of Universities to establish their own e-Universities can be seen in this regard (

Universities and private enterprise are already involved in well-developed initiatives intended to exploit this developing global market. The University of Phoenix is a good example of this: a private for-profit University, it offers distance education through an online interface and through branch offices all over the US to some 15,000 students ( This trend is particularly pronounced in adult business education where there is well-developed competition in distance learning between private providers and with traditional business schools. The costs and risks associated with such ventures though mean that many traditional HE providers are forming strategic alliances to facilitate their entry into the market. There is a multitude of such alliances, but the most developed and high profile of these is Universitas21: a network of 15 Universities around the world in alliance with the Canadian Electronics firm Thomsons. U21 is currently the subject of much debate about employment contracts, student access, quality and Intellectual property ownership. Its aim is to provide "a pre-eminent brand for educational services supported by a strong quality assurance framework." 2

Implications for Public Libraries

It is clear that libraries face similar challenges to HE. Again the threat to publicly funded libraries springs from a number of sources. The continuation of the market assault on public services and the effects of the fiscal crisis of the state threaten the continuation of public funding. This brings with it the threats of closure and a turn to greater private sector involvement. This is particularly so as moves to marketise public services become 'locked-in' to an overarching set of global rules which take on the form of a global constitution for neo-liberal capitalism (Gill, 1999). In this respect a report commissioned by library associations and trade unions in Canada, identifies the regulations and legal frameworks of the General Agreement on Trade in Services as a major threat to the continued public provision of library services (Shrybman, 2001).

However, the initiatives specifically linked to knowledge-based restructuring are also of key relevance to library services. The threat of the commodification of both knowledge and information threatens the very ethos of freely available public provision. Public libraries could find themselves in ever more competition with for profit knowledge institutions and if the GATS framework were extended to libraries then that competition would be intensified through the ending of public subsidies to public library provision (Hunt, 2001). Information and Social Change, as a journal is keenly aware of the implications of how and for whom information is stored, accessed and presented. The contemporary wave of commodification above threatens to restrict the production, dissemination and storage of knowledge purely on its value to the production process. In many ways this is a project of de-politicisation: restricting access to knowledge and information, a process congruent with the embedding of a hegemonic neo-liberal orthodoxy. In this context the social value of information is undermined and carries dire implications for the ability to enact progressive evolutionary social change.

Implications for Society

The redefinition of knowledge production, dissemination and storage as an economic and profitable process: commodification threatens the very fabric of liberal and democratic society. While it is true that education is always linked to the dominant values of any society this current project of commodification poses serious risks. In the past, particularly in the post-war period, education has focused more broadly than the simple skills that individuals may need for a particular place in the workforce. It has contained wider values such as democracy, tolerance, morality and academic knowledge that may be entirely peripheral to the likely employment experience of those being taught. Research too has taken a broad agenda, not focused solely on the production of goods and services that may be sold at a profit. Such breadth in teaching has produced a vital social role, as have publicly funded libraries. It has produced individuals capable of thinking past yesterday's problems and creating innovative and imaginative solutions, fiercely protective of individual freedom and crucially aware of the importance for social stability of some measure of egalitarianism. Independent and free research has allowed public debate access to independent sources of knowledge, an important balance to the impressive research budgets of vested interests. Against this analysis the post-modern, science-fiction, of a clean prosperity ridden new knowledge economy of equality and fairness with the microchip taking the strain, is exposed as mere ideological rhetoric to cover the constant searching of capital for new areas to colonise.

However, the increasing commodification of knowledge production, dissemination and storage is undermining these vital public goods in favour of profit and the simple production of labour power. This poses significant problems for capitalism itself. In limiting what is available as knowledge this restructuring is not only removing checks and balances to corporate power but also the basis of the dynamism of the system itself. It is ironic that the sort of technological advance that has been one of the major driving forces of industrial change over the last thirty years, and has allowed capital accumulation to bypass obstacles that would have otherwise interrupted accumulation, may in the future begin to restrict innovation. Further, when problems do occur, it has in the past been of exceptional advantage to the forces of capital itself to have individuals able to step back from the immediate situation and take a broader perspective something which has been facilitated by the publicly funded and widely available research, education and access to it.


There are key concrete policy initiatives and developments that can be associated with the cacophony of knowledge economy soundbites. However, there is serious doubt as to whether these are new or simply reflect the continual development of productive forces and the labour relations that these give rise to. In particular the knowledge economy seems to be centred on the extension of commodification to the production, dissemination and storage of information. It has been argued here that not only is this undesirable but that the knowledge economy rhetoric is an attempt to cover this up. Additionally, it poses a serious threat to the dynamism of capitalism itself. In this way it is possible to see that while the dynamism of capitalism has allowed itself to emerge from successive crises with the central logic of accumulation still intact, it is still full of internal contradictions that ultimately undermine its own values and integral energy.


1. See

2. See


Tony Blair (2000), Speech to 'Knowledge 2000' - Conference on the Knowledge Driven Economy, available at

Peter Stokes, (2001), "A Global Education Market? Global Businesses Building Local Markets", White Paper, May 2001, available at:

University of Phoenix online:


James D Wolfensohn (July 5 2000), DfEE and DTI (2001), Opportunity For All In A World Of Change, White Paper, London: UK Government, available at:

European Commission (2001), Realising the European Union's Potential: Consolidating and extending the Lisbon Strategy, Contribution to the Spring European Council, Stockholm 24 March, available at


HEFCE and CVCP (2000), The Business of Higher Education: UK Perspectives,

Fiona Hunt (2001), "The WTO and the Threat to Libraries", Progressive Librarian, 18: summer.

Stephen Gill (1999), "The Constitution of Global Capitalism", paper presented to the British International Studies Association, University of Manchester, UK, 20-22 December.

Horward Newby (2000), Some Possible Futures for Higher Education, London: CVCP, available at:

Ruth Rikowski (September 2000a), "The Knowledge Economy is here but where are the information professionals?", Business Information Review, 17:3.

Ruth Rikowski (September 2000b), "The Knowledge Economy is here but where are the information professionals? Part two", Business Information Review, 17:4.

Steven Shrybman, (May 2001), An Assessment of the Impact of the General Agreement on Trade In Services on Policy, Programmes and Law Concerning Public Sector Libraries, available at

Celia Stanworth (1998), "Telework and the information age", New Technology, Work and Employment, 13:1.

"The Role of Information Technology in the Context of a Knowledge-based Global Economy" Statement to the United Nations Economic and Social Council Conference: Development and International Cupertino in the Twenty First Century, New York.

World Education Market:

Alex Nunn is a Doctoral Researcher in the Department of Government, University of Manchester. He is also a Consultant Researcher and Policy Advisor on European and International Affairs for the UK Association of University Teachers.


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