March 1998 Insights Issue #25

Back to Insights #25

Knowledge and development: two sides of tomorrow's coin

We stand at a unique crossroads in history. Whereas 'capital' used to be thought of as the scarce factor in production and the 'transfer of capital' as the key instrument of growth, it is now 'knowledge' that is just as important a factor, if not more so, in development. Pathbreaking knowledge and new technologies offer the chance for developing countries to accelerate the development process at a dramatic rate and join the global economy. But knowledge can be a double-edged sword: if not widely shared, these same advances threaten to widen the gap between the world's rich and poor. The challenge is to put knowledge at the heart of development thinking.

The World Bank is responding to this challenge at both the practical and policy levels. Practically, it is changing the way it does business so that it can tap into the unparalleled reservoir of knowledge it has accumulated over the past 50 years in more than 100 countries. On the policy level, the Bank is devoting this year's World Development Report, Knowledge, Information and Development, to an examination of the role of the public sector in the management of knowledge. The World Bank's comparative advantage lies in its ability to draw lessons across countries and regions, and to bring global best practices to bear in meeting country-specific needs. In order to maximise this ability, the Bank has set up four "networks":

• human development
• poverty reduction and economic management
• private sector development and infrastructure
• environment, rural and social development.