Debnath Sajit Chandra, Doctor with Business Expertise (DBE) Program, Kyushu University;

1. The relationship between good governance and foreign direct investment in East Asia’s knowledge-based economic growth Debnath Sajit Chandra, Doctor with Business Expertise (DBE) Program, Kyushu University; PhD Candidate, Ritsumeikan Asia Pacific University, Japan. Dr. A Mani, Professor at Ritsumeikan Asia Pacific University, Japan.

2. Contents • Introduction • Methodology and data sources • Different approaches of economy • Relationship mechanism among good governance, FDI and KBE in East Asia • The impact of good governance in promoting KBE in East Asia • Good Governance in East Asia • The Role of good governance in promoting KBE in East Asia • The Current Status of Knowledge-based Economy in East Asia • Statistical Findings • Conclusion

3. Introduction • Knowledge-based economy: An economy that creates and diffuses knowledge and thereby achieves economic growth. • Different schools of growth theory, whether of the neoclassical or endogenous types, have all recognized the indispensable role of technological progress and its corollary, knowledge, in sustaining the growth process and increasing the level of per capita income. • Many East Asian economies have shown remarkable success in creating a knowledge-based economy. • This paper attempts to explain the relationship between good governance and foreign direct investment in East Asia’s knowledge-based economic growth.

4. Methodology and Data Sources • Methodology • Qualititative Analysis. • Quantitative Analysis using SPSS software. • Data Sources • Qualitative Analysis • Published articles and books • Quantitative Analysis • Worldwide Governance Indicators, 1996-2007 available at http://info.worldbank.org/governance/wgi/sc_country.asp • IMD online. • Government Finance Statistics Yearbook 2007. • UNESCO online database (http://stats.uis.unesco.org). • World Development Index Database. • The Conference Board and Groningen Growth and Development Centre, Total Economy Database, September 2008. Retrieved from http://www.conference-board.org/economics/ on 8th November, 2008.

5. Neoclassical Approach Market-friendly view Does not explain shift from traditional economic system Economic Growth Industrialization Developmental State Approach State Interventionist View Combination of Market-friendly and State Interventionist View Market-Enhancing Approach Education and Human Resources Knowledge Economy Approach Knowledge-based Economy View Explains shift from traditional economic system Economic Incentives and Institutional Regime Knowledge-based Economy The Innovation System Information and Communication Technology Different approaches of economy

6. Good Governance Development of KBE Infrastructure KBE Attracts FDI and allows Domestic Investment Relationship mechanism among good governance, FDI and KBE in East Asia

7. The impact of good governance in promoting KBE in East Asia • Good Governance in East Asia • The Role of good governance in promoting KBE in East Asia • The Current Status of Knowledge-based Economy in East Asia

14. The impact of good governance in promoting KBE in East Asia • Good Governance in East Asia • The Role of good governance in promoting KBE in East Asia • The Current Status of Knowledge-based Economy in East Asia

18. Taiwan’s data is not available.

19. The impact of good governance in promoting KBE in East Asia • Good Governance in East Asia • The Role of good governance in promoting KBE in East Asia • The Current Status of Knowledge-based Economy in East Asia

20. Current Status of KBE in East Asia

21. Statistical Findings

22. Conclusion • It is evident that the same countries that have superior good governance have performed better in terms of creating knowledge-based economy. • This study of selected East Asian Countries indicates a positive relationship between FDI in East Asia’s knowledge-based economic growth.

23. Thank you for your attention