Building Wealth: The New Rules for Individuals, Companies, and Nations in a Knowledge-Based Economy

The world is on the verge of another industrial revolution, driven by knowledge this time, not the steam engine or electricity, according to noted MIT economist Lester C. Thurow. In his book, Building Wealth: The New Rules for Individuals, Companies and Nations, Thurow writes that "Knowledge is the new basis for wealth. This has never before been true. In the past, when capitalists talked about their wealth, they were talking about their ownership of plant and equipment or natural resources. In the future when capitalists talk about their wealth, they will be talking about their control of knowledge." This means that the Bill Gateses of the world will be on top, not the Rockefellers, Carnegies, or Morgans.

To ready themselves for this new economy, companies and nations need to build what Thurow calls a "wealth pyramid," using building blocks such as a solid social organization, entrepreneurial skills, and education that encourages creativity and curiosity. The United States is better positioned than Europe or Japan to do well in the new economy, Thurow contends, but he warns of weaknesses even here. He puts companies like Intel on top in the knowledge-based global economy and places a question mark next to firms like Wal-Mart. Will the traditional retailer fall to the onslaught of lower-priced Internet competitors, or will it survive because people's herding instincts make them still want to drive to a Wal-Mart store? Bulding Wealth is a worthwhile read for anyone concerned about the wealth of nations and individuals, by the author of such economic bestsellers as Head to Head and The Zero Sum Society. --Dan Ring