Research
 
Applying an Economic Calculus to Knowledge

MEASURING FUNDAMENTAL CLASSIFICATIONS OF KNOWLEDGE AS FACTORS OF PRODUCTION

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Publication:

van den Berg H. (work in progress). Measuring Fundamental Classifications of Knowledge as Factors of Production.

Abstract:

Purpose: The paper demonstrates that fundamental classifications of knowledge may be measurable as factors of production. Furthermore, differences in relative reliance on these classifications of knowledge may be considered indicative of specialization between adjacent stages of a value chain.

Design/methodology/approach: The research relies on surveys completed by portfolio managers (n = 252) and other investment management professionals (n = 106) in the Canadian mutual fund industry (NAICS class 52691). Participants were requested to weigh factors affecting their productivity. The choice of factors was designed to correspond to reliance on tacit, codified, and encapsulated knowledge. Descriptive statistics were used to test for normality, convergent validity, discriminant validity, and scale reliability.

Findings: The paper presents empirical evidence that differences in relative reliance on tacit and encapsulated knowledge between adjacent stages of production may be indicative of specialization. Portfolio managers were found to be generally less (more) reliant on tacit (encapsulated) knowledge than other investment management professionals in the mutual fund industry. These divergences in relative reliance on the fundamentally different knowledge-based factors of production were found between adjacent stages of production, despite the essential overlap of jointly held substantive knowledge.