ASSESSING THE THEORETICAL FRAMEWORK

UNDERPINNING THE RESEARCH

Develop A Framework for Knowledge Base Economy

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values; and or as a set of interrelated decisions concerning the selecting of goals and

the means of achieving them within a specified situation” (Hill, 2013, p.15). Public

policy, however, is referred to as “actions by [a] government, party, ruler and

statesman”; governments or states are basic institutions with superordinate powers

over specific territories (Hill, 2013, p.19). Cairney (2012, p.3) defines public policy as

“the sum total of government action, from signal of intent to the final outcomes,”

while theory is “the set of analytical principles designed to structure our observation

and explanation of the world”. Below are the five main theories of public policy and

how they project the type of governmental structure of a nation.

2.2.1 Pluralist Theory

Pluralism is a theory that argues that the legitimacy of leaders comes from the participation of people through a voting process – creating a democracy that is based on the relationship between electorates and leaders of a political party (Hill, 2013). This implies that leaders receive their mandate to make policies from the electorate. Even though pluralism is promoted as a good way to govern, it has been noted that many countries implement it differently because of the powers granted to various institutions, such as the separation of power between the executive and the legislature (Hill, 2013). Thus, power is diffuse and policy results from the interactions of (or competition between) many individuals and groups (Cairney, 2012).

As a means of decision-making, pluralism has been criticised for its power inequality where sectors of the country can have so much power that they can make others do what they would otherwise not want to do. The other criticism of pluralism is that it can create two classes of people: an elitist group of people who are less numerous but can perform all political functions and who monopolise power and enjoy all the benefits that come with it (Hill, 2013). Conversely, the other group of people are more numerous and are directed and controlled by the elitist class. Elitism is when, “power

is concentrated in the hands of a small number of people or organisations that control

policy processes” (Cairney, 2012, p46). For this research, it would be difficult to

assess how pluralism has been transmitted in the QNV 2030; unless the research focused on the level of acceptance of Vision 2030 as a means of testing how plural the politics are in Qatar; however, this is not the focus of the research.

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2.2.2 Structuralist Theory

Structuralism is a theory that emanates from Marxism, which states that the social structure of a capitalist society is fundamentally a dual class system. On one hand, are the bourgeoisie (owners of the means of production) and on the other, are the proletariat (those who work for the bourgeoisie) (Hill, 2013). The importance of structural theory lies in the political influence that the owners of production exert over the working class; hence, Marxism promoted the political unity of the working class in order to be heard (Hill, 2013). Hill states that, currently, the owners of production can be the state; hence, the state can have political influence because it owns the means of production. As a result, there has been a divergence from classical Marxism through ‘economic determinism’ and ‘globalism’. Economic determinism theory focuses on how politics can be arranged to act as a means of addressing the economic needs of societies – a model that poorer societies should be concerned with (Hill, 2013). Globalism is a theory based on global themes, such as the cross-national diffusion of technology, the development of global financial markets, the emergence of transnational or global corporations, and the emergence of global cultural flows. The theory also addresses major issues, like pollution, international trade standards and the movement of people. All of these issues challenge the perception of state autonomy, stimulating debate on the political arrangements that can make a nation look beyond its borders (Hill, 2013, p.47). This is a crucial theory because the Qatari government participates fully in the production process as it owns many companies; the government therefore has the potential to dictate how the means of production (economy) is structured. As a result, a government policy that aims to restructure an economy, as is the case with the QNV 2030, requires attention from stakeholders. Such a situation highlights the need for this research on how the government can develop a talent management strategy or framework for a knowledge-based economy in Qatar.

2.2.3 Networks Theory

The networks theory advocates creating networks in order to achieve the intended results in governance. For instance, corporatist theory, or corporatism, is when organisations or entities form non-competitive but hierarchically ordered and functionally differentiated categories that can be recognised or licenced by the

61 government with the powers to represent control of a section of their leaders as well as the ability to articulate demands and support (Hill, 2013). In other words, Hill explains that corporatism supports the creation of policy communities or powerful pressure groups that can operate outside the realm of the state. The pressure they can exert on policy formulation should not be ignored because they can form advocacy coalitions in attempts to achieve their goals. There is no evidence of corporatism in Qatar, neither is there a network of organisations whose aim is to formulate advocacy for government policy.

2.2.4 Institutional theory

According to Hill (2013) institutional theory refers to a political democracy that is not only centred on economic and social conditions but also the design of institutions that are cardinal to the smooth running of its politics. Institutional theory, therefore, promotes the establishment of operating procedures related to constitutions, laws, contracts and the customary rules of politics (Hill, 2013). Therefore, the theory plays two fundamental roles: “firstly it realises that policy making affects the degree of

power that any one set actors has over the policy outcomes; and secondly, the realisation that organisational position of influences actor’s definition of their own interests, by establishing their institutional responsibilities and relationships with

other actors” (Hill, 2013, p.73). According to Cairney (2012) there is a different

outlook to institutionalism as it no longer implies established organisations, such as the legislature, courts, and executives, nor the buildings that represent these. Rather it means, “regular patterns of behaviour and the rules, norms, practices and

relationships that influence such behaviour” (Cairney, 2012, p.69). In addition,

“institutions are not only the buildings or arenas within which people make policy;

rather they are seen as rules of behaviour that influence how they make policy”

(Cairney, 2012, p.69). Institutional theory applies to the QNV 2030 because the government introduced the strategy 2011 to 2016 that was to be implemented by two new ministries – the Ministry of Youth and the Ministry of Administrative Development Labour and Social Affairs – alongside the Qatar Leadership Institute (QLI). This implies that government institutions are fundamental to the way policies are implemented in Qatar, making institutional theory critical to this research.

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2.2.5 Rational Choice Theory

Rational choice theory is based on the premise that leaders of modern times can (i) promote, “methodological individualism, accounting for outcomes in terms of individual choices; (ii) they can use deductive methods by deploying models to predict actions; (iii) they behave rationally; (iv) have self-interests; and (v) deploy

subjectivism or political individualism” (Hill, 2013, p.93). In essence, Hill explains

that, in this theory, there is an element of development within a political marketplace where leaders compete for votes by adding economistic reasoning, which means self- interest becomes the dominant motivational force in political behaviour. Through undertaking thorough studies of choice and their effects, leaders are therefore able to apply comprehensive rationality before they make decisions (Cairney, 2012). Rationalism is also linked to incrementalism – a theory associated with the assessment of opportunity cost – where the value of foregone options are considered when studying other options. This means that leaders can choose to study fewer options in more depth (Cairney, 2012). Even though the government of Qatar has been instrumental in creating the QNV 2030 and the 2011 to 2016 strategy, it can be argued that they have been rationally developing their policies even though there is no issue of voting for leadership power. This is because the government structure is not based on such a system whereby leaders are voted in; rather, leadership is appointed by the Emir (king), based on traditional leadership authority.

2.2.6 Public Theory and the Qatari Leadership

To understand the importance of public policy theory to the state of Qatar, it is necessary to examine the leadership in terms of the hierarchical structure of the ruling class. According to Fromherz (2012), Qatar has rapidly changed from being a small, highly traditional, tribal society – a society languishing from the collapse of pearl prices in the 1930s and 1940s – into a vibrant modern nation that currently has a higher per capita income than Luxembourg. The strategic leadership of the ruler, Sheikh Hamad bin Khalifa Al-Thani, has effected this transformation, by over centralising the Emirati power (Fromherz, 2012).

Despite the over centralisation of power in Qatar, the ruler has worked to ensure that the country is not associated with what it is ‘now’ – a nation dominated and built by

63 expatriate labour – but with what is ‘behind it’ – a past reconstructed and reconstituted into nationalised historical moments associated irrevocably with the right of Al-Thani to rule and the right of the Qatari Citizen to enjoy all of the benefits of modern materialism at the service of reconstituted, neo-traditional identities. This deliberate policy by the ruler aims to modernise the nation (Kamrava, 2012b) by ensuring that there is finance for every local Qatari to improve their livelihood (Seznec, 2012). This, it is believed, is the best response to the United Nations’ (UN) agenda to transform the world through sustainable development by 2030 (United Nations, 2015), considering that the state of Qatar has been a member of the UN since 1971.

According to Fromherz, (2012, p.17), Sheikh Tamim bin Hamad bin Khalifa Al-Thani

“does not need to depend on the citizens of Qatar for revenue because he has a personal income in the billions, even if Al-Thani does depend on the citizen elite and a shared sense of history for legitimacy. He does not use oil and gas revenue to placate and control; rather Qatar’s rulers have instead used oil wealth to encourage, push and prod traditional Qatari tribes towards globalisation and the adoption of mainly

western institutions”. It can, therefore, be argued that the policy of developing a

knowledge-based economy (Ulrichsen, 2012) has the full support of the ruler, and is being operationalised through various government structures, as expected by the UN agenda 2030 (UN, 2015). There is already evidence that organisations have embarked on employing local people in managerial positions; for instance, Fromherz (2012) states that there are fewer Qataris ready to engage in non-managerial tasks than in other Gulf countries, meaning that the redistribution of oil and gas revenues has made Qataris among the richest people in the world across the social spectrum. It is also noticeable that the QNV 2030 does not operationalise how to transform the talent of local Qataris to drive the economy into a KBE. This, again, justifies the need for the present research, which can use current public policy to propose a strategy for the government to use to encourage talent management at an industry level.

2.3

Economic Growth Theory

Knowledge is considered a key driver for economic productivity and growth. Across the globe, leaders are realising the importance of technology and seeing that economic

64 performance can be boosted by the creation and sharing of knowledge. This requires a skilled labour force to adapt their skills and competencies to sustain the economic growth (OECD, 1996). According to Robinson (1972, p.54), “economic growth

theory covers a myriad of theories that focus on the mechanism with which a nation can increase the aggregate product, either total or per capita, without reference to changes in the structure of the economy or in the social and cultural value systems”.

On the other hand, economic development theory looks at, “economic growth that

includes the social and cultural changes which occur in the development process”

(Robinson, 1972, p.54). The importance of economic theory to this research starts with how nations view economic growth. For instance, Harbison and Myers (1964) theorised that the world is driven by the desire to develop, thus for underdeveloped counties, the revolt against poverty, disease, ignorance and international exploitation has been going on for decades. For developed nations, the drive has been centred on a continued acceleration to exploit developmental opportunities on earth and space alike (Harbison & Myers, 1964). To this effect, Harbison and Myers state that economic growth theory is centred on the perception that modernisation and development are matters that impact productivity, national income, balancing payments, and the savings or investments in a particular country.

According to Rivera (2016), the theory of economic growth becomes strong when assessed from two inter-related theories, namely: (i) neoclassical growth theory, which adheres to promoting free markets, exports, trade liberalisation, and foreign investment in an attempt to spur efficiency and development; and (ii) endogenous growth theory, which basically supports the active role of the state in promoting economic development through direct and indirect investment in human capital. Hunt (2007, p.274) opined that, in an ideal economy, a nation would do well to support growth by, “increasing investment, and the dynamic competition model, which

maintains that growth results from the innovations that stem from the process of

competition”, hence allowing for dynamism in the process.

Over the years, economists have argued for government or state participation in the promotion of economic growth, resulting in market antagonism between the state and the market (Reinsert, 1999). However, the right balance of state policies can lead to,

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infrastructure and if necessary to function temporarily as an entrepreneur of last

resort” (Reinert, 1999, p.268). Other nations opt to attract foreign direct investment

(FDI) as a model through which they can seek encourage economic growth (Herzer, 2010).

As a nation, Qatar has been working to develop the economy into a knowledge-based economy using the Vision 2030 (QNV, 2016). As the Vision 2030 policy is centred on local Qataris, the most ideal economic growth theory for this research is the “endogenous growth theory”. The word endogenous literally means, “found or

coming from within something” (Cambridge University Press, 2016). According to

Aghion and Howitt (1998), endogenous economic growth involves a two-way interaction between technology, innovation and economic life, where technological progress transforms the very economic system that creates it. The purpose of endogenous theory is to seek an understanding of this interplay between knowledge as an asset impeded by human capital and various structural characteristics of the economy and society, and how such interplay results in economic growth (Aghion and Howitt, 1998). Romer’s (1994) ‘endogenous growth’ embraces a diverse body of theoretical and empirical work that distinguishes it from neoclassical growth theory; this is because it emphases the argument that economic growth is an endogenous outcome of an economic system, not the result of forces that impinge from the outside. According to Pack (1994), endogenous theory may seem to explain the growth pattern over time of national economies; however, the reality is that it basically expands the existing growth theory rather than provide a powerful organising framework for thinking about actual growth phenomena. However, economic growth cannot be achieved if there is no link with human development, as it

is, “a process [for] increasing the knowledge, the skills and the capacities of all the

people in society” (Harbison & Myers, 1964, p.2). It is for this reason that economic

growth theory has been considered crucial to this research, the aim of which has been to establish a detailed strategy – herein called a framework – for the management of Qatari talent to enable the development of a knowledge-based economy in accordance with Vision 2030.

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2.3.1 Natural Resources and Economic Growth

Within economic growth theory, it is vital to assess the view that many economies can grow if they are driven by natural resources (Havranek, Horvath & Zeynalov, 2016). However, it has been found that, even though natural resources can underpin economic growth, other aspects of the economic structure are necessary for a nation to grow its economy; not all natural resources have had a positive impact on economies around the world (Havranek et al., 2016). For countries in the Middle East with a resource-based economy, the main natural resource has been oil and gas – a category of energy resource. Kumar, Stauvermann, Loganathan and Kumar (2015) demonstrated that there has been a nexus between energy resources and economic growth, among other issues. It can be argued that there is a positive correlation between access to energy resources, such as oil and gas, and economic growth – as demonstrated by the GCC countries (Kumar et al., 2015). For instance, (Ahmed, Mahalik, & Shahbaz, 2016, p.213) found that not all countries benefit from the argument that, “economic growth is a function of natural resources, exports, capital

and labour”, and a good example of this is Iran. This implies that over reliance on

natural resources can either hinder or promote economic growth depending on how well the other elements of the economy are structured. It also implies that nations have a varied approach to how the structure their economies even though the growth theory remains the same for all instances on paper (Gabriel, Jayme Jr & Oreiro, 2016). Nevertheless, the Qatari Vision 2030 places an emphasis not on its natural resources but on developing its people so that the economy can be transformed into a KBE.

2.3.2 Theory of Migration and Economic Growth

According to Bove and Elia (2016), the theory of economic growth for many countries around the world would not be complete without examining the potential impact (positive or negative) of migration and diversity within their society. They argued that, on one hand, it has been theorised that as migrants move from country to country they positively impact the economies they go to because they tend to take with them the necessary skills and perspectives that nurture technological innovation, hence stimulating economic growth as a result (Bove & Elia, 2016). On the other hand, they suggested that migration can negatively impact economic growth because

67 the increased heterogeneity may undermine social cohesion, create coordination, and

communication barriers” (Bove & Elia, 2016, p.1). It shows that, for a country to spur

economic growth using migrants, it has to institute measures to maximise the benefits and minimise the side effects of migration on social and cultural cohesion within the society. It can be argued that the theory of migration on economic growth, therefore, becomes an intricately interwoven factor in the continued expansion of economic growth theory, whose fundamental composition should include “not only income but

also human capital, demographic transition, technology/urbanisation, institutions,

and economic integration” (Hafner & Mayer-Foulkes, 2013, p.107) among other key

factors. For instance, Hafner and Mayer-Foulkes, (2013, p.108) suggested that there