Strategies for Building a Knowledge-Based Economy for Community Enterprises in the Eastern Economic Development Zone

Abstract

This research aims to study the strategies for creating a knowledge-based economy for community enterprises in the Eastern Economic Development Zone. The study has been designed as a mixed method by developing the analysis of structural equation model through qualitative data and the quantitative data were derived from the survey of 300 community enterprises in the Eastern Economic Development Zone. They’re used descriptive statistics, inferential statistics, and multivariate statistics. The research instrument was a questionnaire and analyze data with Structural Equation Modeling: SEM. The data analysis program AMOS stipulates a multi-stage sampling method. It consists of group sampling procedures (Cluster-sampling) separating the populations into 3 areas. Then they’re used simple random sampling to obtain the required number of samples according to the desired proportion. The finding consists of three components that are important to the strategy for building a knowledge-based economy at a high level according to the Likert scale: namely, management components, new product development, and marketing. To assess the coherence of the structural equation model, the strategies for creating a knowledge-based economy for community enterprises in the Eastern Economic Development Zone passed the model's evaluation criteria which are consistent with the empirical data. In accordance with the Modification Indices, it was found that the root index of the square mean of the Chi-Square Probability Level was 0.109 while the relative Chi-square was 1.316. The Goodness of Fit Index was 0.973 and the Root Mean Square Error of Approximation was 0.033. It was found the components of Management have highest direct influence on New Product Development components (DE= 1.11) followed by New Product Development components, which have direct influence on Marketing (DE= 0.57) and Management components have direct influence on Marketing (DE= 0.42) From this study, it is learned about the strategies for creating a knowledge-based economy for community enterprises in the Eastern Economic Development Zone. To increase potential of the Grassroots Economy, to provide income, to reduce inequality, and brings community enterprise to be sustainably.