Proceedings of the 12th European Conference on Knowledge ...

National Knowledge Management Strategy for <strong>the</strong> TRNC:
Recommendations for Small Island Economies
Behiye Çavuşoğlu and Mustafa Sagsan
Near East University, Nicosia, Turkish Republic <strong>of</strong> Nor<strong>the</strong>rn Cyprus
behiyet@yahoo.com
msagsan@gmail.com
Abstract: In order to make national knowledge management strategy (NKMS) in particular small island
economies within developing countries, not only <strong>the</strong> macro economic indicators but also knowledge economy
variables should be considered. The paper is trying to find answer by questioning “how national knowledge
management strategies could be applied by <strong>the</strong> small island economies” based on <strong>the</strong> knowledge economy
variables such as gross domestic investment to GDP ratio, trade to GDP ratio, higher education enrollment ratio,
telephone main lines, <strong>the</strong> mobile subscribers, and <strong>the</strong> number <strong>of</strong> Internet users. At this point, <strong>the</strong> empirical part <strong>of</strong>
<strong>the</strong> study investigates <strong>the</strong> availability <strong>of</strong> knowledge economy variables <strong>of</strong> TRNC, as a small island. The results
show us that, as a developing country, TRNC has inadequate knowledge economy variables for making NKMS.
In conclusion, <strong>the</strong> advantages and disadvantages <strong>of</strong> <strong>the</strong>se inadequacies were discussed and proposed
suggestions for TRNC which is at <strong>the</strong> developing stage <strong>of</strong> economic growth.
Keywords: Knowledge economy, small island economies, national knowledge management strategy, Turkish
Republic <strong>of</strong> Nor<strong>the</strong>rn Cyprus
1. Introduction
Although knowledge management is a s<strong>of</strong>t science, one <strong>of</strong> <strong>the</strong> hardest topics <strong>of</strong> <strong>the</strong> field is knowledge
assets, which could be measured by some <strong>of</strong> <strong>the</strong> techniques, contributed to <strong>the</strong> organizational
effectiveness and based on knowledge economy indicators. Knowledge assets are <strong>the</strong> intangibles
and a part <strong>of</strong> intellectual capital (IC) within <strong>the</strong> literature. Based on <strong>the</strong> knowledge economy indicators
such as gross domestic investment to GDP ratio, trade to GDP ratio, higher education enrollment
ratio, telephone main lines, <strong>the</strong> mobile subscribers, and <strong>the</strong> number <strong>of</strong> Internet users were considered
in this study. The question on how national knowledge management strategies could be applied by
<strong>the</strong> small island economies based on <strong>the</strong>se indicators is attempted to answer. We also would like to
find answer ano<strong>the</strong>r question: what indicator exactly allows us to understand knowledge based
economy within <strong>the</strong> small island. These two fundamental research questions enable us to select a
country, which has a small island economy, for example TRNC based on <strong>the</strong> NKMS.
2. What encourages to making ‘national knowledge management strategy’ in
terms <strong>of</strong> knowledge economy?
There are four main concepts that need to be explained by defining national knowledge management
strategy: knowledge economy, intellectual capital, and information policy and knowledge assets.
2.1.1 Knowledge Economy
According to Lor and Britz (2006), a knowledge society operates within <strong>the</strong> paradigm <strong>of</strong> <strong>the</strong>
economics <strong>of</strong> information and <strong>the</strong> human capital is <strong>the</strong> prime input to production and innovation. They
also defined <strong>the</strong> knowledge as not <strong>the</strong> result <strong>of</strong> collection, processing and distribution <strong>of</strong> data;
knowledge requires application experience and <strong>the</strong> exercise <strong>of</strong> judgment. The growing codification <strong>of</strong>
knowledge and its transmission through communications and computer networks has led to <strong>the</strong>
emerging information society (Dutton, 2004). By <strong>the</strong> help <strong>of</strong> <strong>the</strong> above definitions we have a chance to
separate <strong>the</strong> knowledge society and information society. An information society besides from
knowledge society is to use, to create, to distribute <strong>the</strong> information is significant economic activity
judgment is not important.
According to Asgeirsdottir (2006: 18-22) <strong>the</strong>re are four important factors that need to be taken into
account when countries and <strong>the</strong>ir institutions want to promote <strong>the</strong>ir knowledge economy. The first one
is based on <strong>the</strong> economic fundamentals, which entails stable macroeconomic policies; wellfunctioning
labor, product and capital markets; efficient training policies in order to protect knowledge
divide; competition policies on low cost technology; liberalization <strong>of</strong> telecommunications policies; and
openness to trade and foreign direct investment. The second one refers to knowledge economy,
which includes four main issues: innovation (R&D expenditure, patents, etc), new technologies (ICT
investment in terms <strong>of</strong> its contribution to GDP growth, nanotechnology\bio technology), human capital
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