Recently, an ethnically-Japanese professor from the Massachusetts Institute of Technology visited Taiwan. On a Monday night at around 11pm, the professor went to the Eslite bookstore on Taipei's Tunhua S. Road. Upon seeing the crowds inside, he said it would be impossible to witness such a scene in Japan and that Taiwan has already advanced into a knowledge-based economy.
So late, and yet so many people in a bookstore, marveled the professor. Japan has some 24-hour shops, the professor said, but no 24-hour bookshops. What the professor found even more surprising was that Chinese and English-language books were displayed together according to subject -- something also impossible to see in Japan. Bookstores in Japan also sell English-language books, but they would undoubtedly be concentrated in special sections for the minority of people who need them. The majority of Taiwan's readers can accept a mixture of English and Chinese-language books.
Of course, as Eslite is only a symbol of Taiwan's elite class of book lovers, it is difficult to make the deduction that Taiwan has already entered a knowledge-based economy. Still, the "Eslite phenomenon" certainly left a lasting impression on the professor.
Last year, Business Weekly (商業周刊) magazine had 10 popular consumer experts select Taiwan's "Top ten products of the year." The products were: Harry Potter products, counterfeit banknote detection devices, "Red Label" rice wine, the TV drama Meteor Garden (流星花園) and products featuring the pop group F4, on-line games, ADSL services, Next Magazine (壹週刊), Korean TV dramas, Internet cafes, and the movie Crouching Tiger, Hidden Dragon (臥虎藏龍).
Besides the editors' conclusion that the products shared a common denominator of being "inexpensive and fantasy-related," we can also interpret the results from the perspective of a knowledge-based economy. Of these 10 products, apart from the rice wine and counterfeit detection devices, most of the other items are not "tangible products."
By comparison, Japan's top-ten products last year included six kinds of physical products: digital cameras, home beer-brewing equipment, ?280 Yoshinoya beef bowls, vacuum cleaners, DVD players, CD burners and canned tea drinks.
Looking at Taiwan's past top-ten lists, there was a greater number of tangible, physical products, such as the PDA, DVD players, and digital cameras three years ago, while two years back, there were more mobile phones, recreational vehicles (RVs) and hermetically sealed drinks for take-out.
Among last year's top-ten products -- Harry Potter products, Crouching Tiger, Hidden Dragon, Korean TV dramas, and Next Magazine constitute "content products," while Internet cafes, online games, Meteor Garden and F4 were all "experience products."
In Taiwan's marketplace, demand for such products far surpasses that for tangible products. Actually, content and experience products are both defining characteristics of a post-industrial society. Apart from the sensitivities displayed by the Business Weekly's judges, these top-ten products are a reflection of the average person's common knowledge and experience. Thus, saying that Taiwan's masses have embraced a knowledge-based or experience-based economy is not far off.
It is doubtful whether our "producers" can keep up with consumers in terms of thinking up and creating new products. Everyone can see that the origins or original concepts for these top-ten products are foreign -- such as the UK (Harry Potter), South Korea (Korean TV dramas, online games), Hong Kong (Next Magazine), and Japan (Meteor Garden). Apart from products unique to Taiwan, such as rice wine and counterfeit detection devices, all the top-ten products were imported from elsewhere.
What significance lies behind this? Has it become difficult for Taiwan to "create" things that its own people like -- let alone create products that will become popular in Japan and Korea? While some things "made in Taiwan" circulate abroad, most are produced by OEMs for the benefit of someone else. There is practically nothing that is actually "created" in Taiwan. It would even be pushing it to say that Crouching Tiger, Hidden Dragon was a Taiwanese creation.
A knowledge-based economy is about the circulation of knowledge products. If the Chinese TV dramas "Genghis Khan" (成吉思汗), "Yong Zheng" (雍正王朝) and "Kang Xi" (康熙大帝) can be well-received in Taiwan, yet Taiwan's TV and movies can't reach beyond its own borders, then our cultural influence doesn't amount to much.
Professor Zhang Xianzhong (張憲忠) from the Shanghai Jiao Tong University has pointed out that in the past several years, Shanghai has absorbed a great amount of outside investment. Still, while considerable investment has been made in high-tech R&D, there have been few successful enterprises in this area. None of the well-known products made by China's important high-tech enterprises -- such as Haier (海爾), Changhong (長虹), Legend (聯想) or Beida Founder (北大方正) -- come out of Shanghai. Does this mean finance and trade ports like Hong Kong and Singapore are fated to be compradors?
If Taiwan develops into a "silicon island," "silicon" should denote not only the manufacture of semiconductors and high-technology, but also the innovative spirit of Silicon Valley. It should be about creating new concepts, content, and business models. If we pursue this kind of creative and innovative power, we also need to establish some indicators other than the traditional industrial and economic ones, such as production value and GDP. Only by understanding our progress toward a knowledge-based economy and developing creative talent will we be able to find a way out for Taiwan.
Wen Chao-tung is a professor in the Graduate Institute for Technology and Innovation Management at National Chengchi University.
Translated by Scudder Smith
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