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Small Business Economics

, Volume 44, Issue 1, pp 207–218 | Cite as

Firms size and directed technological change

  • Cristiano Antonelli
  • Giuseppe Scellato
Article

Abstract

The analysis of the characteristics of firms helps to understand the causes and consequences of the direction of technological change. Firms differ substantially with respect to the type of technological knowledge they can generate and exploit through technological innovations. This in turn has major effects on the direction of technological change they are able to introduce. Large firms able to command the recombinant generation of codified knowledge with a strong scientific base are more likely to introduce neutral technological changes that consist in a shift effect of production functions. Small firms that rely more on tacit and external knowledge are more likely to rely on technologies directed toward the most intensive use of locally abundant production factors. The effects of this difference in terms of the resulting total factor productivity growth are important and can be grasped only when the changes in output elasticity of production factors in growth accounting are properly appreciated. The empirical evidence for a sample of 6,600 Italian firms observed between 1996 and 2005 confirms that large firms introduced mainly neutral technological changes while small firms with lower levels of profitability introduced biased technological changes.

Keywords

Directed technological change Types of innovation processes Size of firms Growth accounting 

JEL Classifications

O30 L26 

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Copyright information

© Springer Science+Business Media New York 2014

Authors and Affiliations

  1. 1.Dipartimento di EconomiaUniversità di TorinoTurinItaly
  2. 2.BRICK (Bureau of Research in Complexity, Knowledge, Innovation)Collegio Carlo AlbertoMoncalieriItaly
  3. 3.Dipartimento di Ingegneria Gestionale e della ProduzionePolitecnico di TorinoTurinItaly

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