What Singaporeans must know about ‘innovation economy’Singapore Business Review
In his groundbreaking book, The Third Wave (1984), Alvin Toffler proposed that the human civilization has invented and experienced three types of wealth systems. Each wealth system is fundamentally different and has a distinct set of principles for wealth creation and distribution. The adoption of a new wealth system is followed by a major wealth shift from the old guards to the new innovators.
The first system was the agrarian (i.e. agricultural) economy which surfaced more than 10,000 years ago. Empires and landlords came to dominate the riches, by exerting militaristic forces. The second system, the industrial economy, sank its roots in the mid 18th century. Multinational corporations and industrialists seized economic power through market forces. The third system, the knowledge economy, probably dawned in the 1950s with the invention of electronic computers. Today, we are witnessing the rise of megacities and entrepreneurs who are exploiting creative forces. The primary factor of production has shifted from land (agrarian) to labor (industrial), to ideas (knowledge).