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Edited by Léo-Paul Dana
Chapter 16: East Asian Perspectives of International Entrepreneurship
Chew Soon Beng and Rosalind Chew The purpose of this chapter is to present an analytical framework to understand the interdependence among foreign investment, international entrepreneurship and domestic entrepreneurship in the new economy. Factors aﬀecting each of these economic activities are analysed for selected countries in East Asia. The knowledge economy In the old economy, the law of scarcity prevailed in the sense that, if you can produce goods that others do not and cannot, you enjoy a proﬁt in production because you have a comparative advantage. The same law of scarcity still prevails in the new economy or the knowledge economy, in that you still must have a comparative advantage to proﬁt in business, whether in the production of goods or in services. One of the main diﬀerences between the old economy and the knowledge economy is that there is increasing importance of knowledge, creativity and skills in changing the way ﬁrms compete and the sources of comparative advantage between nations (Coates and Warwick, 1999). In the old economy, natural resources were the main factors determining comparative advantage. Next in importance was capital, followed by process technology. Desnoyers and Lirette (1999) document that, in the case of Canada, between 1990 and 1997, high-knowledge industries enjoyed much higher growth in employment than medium-knowledge industries and lowknowledge industries (see Table 16.1). Furthermore medium- and lowknowledge industries are more sensitive to changes in economic conditions than high-knowledge industries. Data on Singapore show the same trend (see Tables 16.2...
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