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output. The study begins by examining the production flow and specifically looks at

the allocation of costs among the input factors of the production process. It also inves-
tigates how production costs are transformed into physically tangible inputs before pro-

duction.
In the classical economic model, capital is the fundamental basis for the pro-

duction process. It encompasses tangible inputs like land, natural resources (such as
minerals and plantation products), labor, production costs, and machinery that are a

human innovation product. This classical economic model prioritises the classical

concept of capital, which views capital as a tangible thing utilized in the production
process to generate output. However, the traditional economic model is inadequate

as it fails to account for the crucial factor of how physical inputs are utilized in the
production process to generate outputs. This involves leveraging accurate knowledge,

which may be imparted to achieve output with a lower minimum capital requirement.

The current economic paradigm is rapidly advancing in its growth. The percep-
tion of economic elements is that they impact the advancement of production, leading

to the emergence of a more intelligent perspective. Kaihara, Kita, and Takahashi
(2021) argue that the concept of "smart" is integral to the vision of a "smart society"

and encompasses economic factors that impact both the economic and social sys-

tems. "smart" describes these economic factors and their influence on the social sys-
tem. The term "smart" is commonly used in information technology development.

However, its precise definition and implications in systems science and engineering
within the economic and social domains are still being explored. Hence, the systems

approach to smart technology in the economic vision aims to create, strategize, and
manage a "smart platform" to optimise production factors and transform the economic

and social system. The proposed approach entails a smart platform as a network

model, incorporating various stakeholders and supply chain variables. Four concep-
tual frameworks relating to the platform of design, planning, and operation are consid-

ered in terms of system optimization. These frameworks are referred to as "intelli-
gence" frameworks. (1) A smart platform is introduced as a market mechanism to

adjust and meet the needs of supply and demand conditions in the economy. It enables

autonomous and decentralized decision making in artificial intelligence systems. (2)
The smart platform adds more flexibility to design, planning, and operation by adjusting

"flexibility variables" in decentralized decision-making control. (3) Policy-making mech-
anisms are introduced in the economic and social system on smart platforms through

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