Knowledge Economy and North Cyprus

It is very well known in the knowledge management literature that knowledge has become an engine of social, economic and cultural development in today's world. Involvement of education in economic growth occurs through creation of new knowledge and transfer of knowledge and information. Better educated individuals will later become an innovator or creator of new technology. Schools provide the education necessary to understand this new information and technology. Education is a vital factor for the accumulation of intellectual capital to reach economic growth. As a small developing island with its eleven universities, government assigning education is one of the locomotive sectors of the North Cyprus economy. Today's globalised world, transforming economies from traditional labour based production technique to modern knowledge based production technique is inevitable. Rise of knowledge and technology- intensive jobs and economic activities, investment in knowledge based assets and increasing well qualified and educated workforces indicates the knowledge based economic transformation is necessary and inevitable for rapid economic growth. The main purpose of this paper is to point out knowledge and knowledge based economies and creates both the public and government awareness about knowledge based economy in North Cyprus. The paper also investigates the importance of human capital, intellectual capital and intangible assets in production process and emphasizes the importance of technology based highly productive production systems and their impact on economic development. The study will be a reference to other small economies as well.