Abstract
Recent thinking about technical change has been strongly influenced by the theoretical work of Joseph Schumpeter. As we have seen in the previous chapter, most analyses of innovation, since Schumpeter, have considered innovation as a somewhat momentous, discrete event made possible by a prior invention and drawn into economic significance by a process of diffusion.1 Moreover, these analyses have focussed primarily upon the hardware aspect of innovation in that they have given prominence to artifacts that is, to the things that have been made. For present purposes this approach has two significant shortcomings: it fails to recognise first that innovations are rarely fully developed when they are first introduced and second that their full economic significance depends upon the continued development of the original innovations during a period following their introduction to the market-place. Both these shortcomings direct our attention to a process that we have described as post-innovation improvement and, in our framework, these improvements are of overriding importance. It is not the initial event but rather the subsequent sequence of interrelated innovations which distinguish the important from the economically inconsequential in the realm of technological development.2
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References
I. For the best general review consult C. Freeman, The Economics of Industrial Innovation (2nd edn) (Pinter, 1983).
N. Rosenberg has been particularly emphatic on this point; see his paper ‘Technological Interdependence in the American Economy’ in N. Rosenberg, Inside the Black Box: Technology and Economics (Cambridge University Press, 1982). For an application of the idea of clusters of interrelated innovations to the electronics and synthetic materials industries consult C. Freeman, J. Clark and L Soete, Unemployment and Technical Innovation (Pinter, 1982).
E. T. Layton, Jr, ‘Technology as Knowledge’, Technology and Culture, vol. 15, 1974, pp. 30–41.
On the characteristics approach to technology see P. Saviotti and J. S. Metcalfe, ‘A Theoretical Approach to the Construction of Technological Output Indicators’, Research Policy, vol. 13, 1984.
See D. Mowery and N. Rosenberg in Rosenberg (1982) Inside the Black Box.
To give one of many examples, the reader may consult P. A. David, ‘The Landscape and the Machine, Technical lnterrelatedness, Land Tenure and the Mechanization of the Corn Harvest in Victorian Britain’ in his Technical Choice of Innovation and Economic Growth, (Cambridge University Press, 1975). This essay shows how the adoption of the mechanical reaper depended not only upon its labour-saving characteristics but also upon its characteristics in relation to the size of field, land drainage and the general terrain of farming.
Saviotti and Metcalfe, ‘A Theoretical Approach’, indicate how this line may be pursued.
Cf. F. Machlup, ‘The Supply of Inventors and Inventions’, in R. Nelson (ed.) The Rate and Direction of Inventive Activity (NBER, 1962) p. 161.
J. Hicks, Economic Perspectives (Oxford University Press, 1977) p.16.
The concept of a trajectory is discussed in R. Nelson and S. Winter, An Evolutionary Theory of Economic Change (Harvard University Press, 1983) pp. 258–9. Reference should also be made to the interesting work of G. Dosi who proposes the Kuhnian notion of a paradigm — ‘a pattern of solution of selected technological problems’ to play a role analogous to our technological regime. G. Dosi, ‘Technological Paradigms and Technological Trajectories’, in C. Freeman (ed.) Long Waves in the World Economy (Butterworth, 1983).
A study performed in Japan which aimed to compare the technological level of Japanese industry with its competitors across forty-three product lines, used a single characteristic to describe progress in each product. International Quantitative Comparison of Japanese Industrial Technology in MITI (JETRO, 1983).
Cf. Jantsch, Technological Forecasting in Perspective, (OECD, 1976) section II, chap. 3. The switches to a new design configuration are there referred to as ‘escalation’ of technology.
Lord Robbins, An Essay on the Nature and Significance of Economic Science (Macmillan, 1932) p. 16.
Ibid, p 33. Adam Smith, it will be remembered, was the chief exponent of the material-welfare viewpoint. He was also the economist who first linked the state of technology to certain economic determinants, with his principle that the division of labour is limited by the extent of the market.
P. J. McNulty, ‘Economic Theory and the Meaning of Competition’, Quarterly Journal of Economics, vol. 82, 1968, pp. 649–56.
In F. A. Hayck, Individualism and Economic Order (Chicago University Press, 1948).
Ibid, pp. 100–1, author’s emphasis.
In passing one should note that not all economists who see the subject in terms of resource allocation ignore the importance of technological phenomena. Thus, the great American economist, Irving Fisher, writing contemporaneously with Robbins, drew attention to the importance of corporate research expenditure and mass production of inventions, the point being that such investments in knowledge fell within that category of economic decision-making which involves weighing future gains against present losses. The Theory of Interest (Macmillan, 1930) chap. 16.
J. Schumpeter, 1911, Theory of Economic Development (Oxford University translation, 1934).
Ibid, p. 83.
J. Sehumpeter, Capitalism, Socialism and Democracy (Unwin, 1943).
Ibid, pp. 81–6.
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© 1986 Luke Georghiou, J. Stanley Metcalfe, Michael Gibbons, Tim Ray and Janet Evans
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Georghiou, L., Metcalfe, J.S., Gibbons, M., Ray, T., Evans, J. (1986). Continuity and Competition in Technological Development. In: Post-Innovation Performance. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-07455-6_3
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DOI: https://doi.org/10.1007/978-1-349-07455-6_3
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