| Chapter 2: | Poverty and the Knowledge Economy |
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to changes in the university whereby science and technology, along with research and development, have assumed central importance (Calderone and Rhoads 2005; Geiger 2004). Although the transformation of economies and key institutions such as the university impacts all nations of the world, such a shift is far more prominent in the wealthiest nations, where the most advanced forms of science and technology exist.
Slaughter and Rhoades described the new economy as an environment that “treats advanced knowledge as raw material that can be claimed through legal devices, owned, and marketed as products or services” (2004, 15). As a result of this phenomenon, it is difficult to separate universities from this new economy: they are key locations of knowledge creation. These institutions not only contribute to the knowledge economy, but they have in fact helped to create it. This is evidenced at universities in the United States in the number of patents created, the number of publications produced, and the high rate of technology transfer (Slaughter and Rhoades 2004). It is therefore essential to consider the role of the university in developing nations’ quest for economic development.
Only in recent years have IGOs come to see the university as a critical player in economic development in the third world. Before these development organizations began contributing to linking higher education and knowledge development, however, two schools of thought dominated two distinct historical periods and had a negative effect on university systems in developing countries: the funding of vocational education to the exclusion of other forms of higher education during the 1950s infrastructure drive and the focus on primary education during the 1980s through the implementation of structural adjustment programs.
During the 1950s, development agencies focused on building a modern commercial sector alongside a labor-intensive sector so as to expand productivity. It was an industrialization strategy intended to lead to social and economic progress. Rostow presented five stages of economic growth that capture the approach to development at the time: (1) traditional society, (2) preconditions for takeoff, (3) takeoff, (4) the drive toward maturity, and (5) the age of high mass consumption. Following the development experience of the West, he claimed that every society