Is a Knowledge-based Economy Sustainable?

by Suzana Engman

Once more Puerto Rico is in the midst of an economic revolution. The government envisions a New Economy starring human capital, with education and the university assuming supporting roles. But is a knowledge-based economy sustainable?

Maybe not, says Criseida Navarro-Díaz, regional planner, real estate specialist, economic developer, and associate professor of planning at the University of Puerto Rico, Río Piedras. “If we’re just interested in economic growth, instead of an overall development level or standard of living, then it might not be responsible or sustainable.”

When she began her urban planning doctorate at MIT, Navarro-Díaz was working with the Puerto Rico East-Central Technological Initiative (INTECO by its Spanish acronym).

“At that time the government had two different strategies. One was for poverty reduction and the other was for science and technology-driven economic development. I found that there were incongruencies in the way that they were being implemented simultaneously. A science-driven economic development policy in the absence of other measures wouldn’t be able to reduce poverty if the people were not able to find employment.”

Navarro-Díaz’ dissertation examined 50 regions in the United States to see if an increase in science and technology businesses was forcing migration of low-skilled workers because of inflated housing prices, decreased pay, and lower demand for low-skilled labor. She found that, indeed, as she had hypothesized, low-skilled workers moved out when science and technology businesses moved in. Highly-skilled workers were also forced out of many metropolitan regions by unbearable housing costs.

Navarro-Díaz is now examining the impact of a science and technology economy on Puerto Rico. She has found that high concentrations of science and technology activity are associated with high costs, increases in housing prices, and reductions in the amount of land available for residential use in urban areas.

The professor says that the pattern of sustainability in Puerto Rico is similar to that in the States, though it is more subtle because here a shorter period of time has elapsed since implementation of the science and technology economy.

Navarro-Díaz is also researching how to sustain a market-driven curriculum. With funding from the Office of the Dean of Graduate Studies and Research, she is developing a follow-up, feedback, evaluation, and revision database, which will be used to adjust the School of Planning’s courses to the changing environments in which planning graduates find themselves. For example, with privatization and non-profit NGOs, planners are now employed in the private as well as public sectors, and they must now pass a licensing exam. They also must keep their knowledge—including research skills and familiarity with emerging technologies—up-to-date via continuing education. Soon licensed planners may abide by an ethical code that is currently under evaluation.

Despite the data she has collected, Navarro-Díaz is not pessimistic about the future sustainability of Puerto Rico’s economy because, she says, “Social responsibility and equity are very important here.”