The Tacit-Knowledge Economy
Knowhow resides in brains, and emerging and developing countries should focus on attracting them, instead of erecting barriers to skilled immigration. Because knowledge moves when people do, they should tap into their diasporas, attract foreign direct investment in new areas, and acquire foreign firms if possible.
CAMBRIDGE – Almost all rich countries are rich because they exploit technological progress. They have moved the bulk of their labor force out of agriculture and into cities, where knowhow can be shared more easily. Their families have fewer children and educate them more intensively, thereby facilitating further technological progress.