Economic growth related to mutually interdependent institutions and technology (original) (raw)
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Economic growth, innovation, institutions, and the Great Enrichment
Asia Pacific Journal of Management, 2019
A number of factors are held up as causes of the economic takeoff of the early 1800s in northwest Europe and North America and later Asia, though certain popularly believed factors such as geography and capital accumulation do not have much empirical support. Nor do other commonly held factors such as trade, plunder, and colonization. It is better understood today that productivity enhancing innovation, new venture and new market creation enabling consumption by a wider range of consumers yield firm and economic growth, as well as improved standards of living. In this overview, these literatures are summarized and examined. In addition the evidence regarding the effect of institutions on economic growth is discussed as well as the role of international business in the transfer of positive institutions and organizational routines.
Growth, History and Institutions
Cepr Discussion Papers, 2004
Bhaduri focuses on the Keynesian theory of effective demand and the Schumpeterian emphasis on the influence of market structures on technological change. The third chapter, by Ferdinando Meacci is, by contrast, mainly historical: it completes the two previous viewpoints on the classical economists with a reconstruction of Smith's competition-of-capitals doctrine. The next four chapters introduce heterodox models and comparison among them. Chapter 4, by Duncan Foley and Lance Taylor, describes a heterodox macroeconomic model put together with two explicit aims in mind: 'to set out a benchmark for comparison of heterodox and orthodox approaches to economic growth and income distribution, and to point out similarities shared by a wide range of heterodox models'. Chapter 5, by Gennaro Zezza and Claudio Dos Santos, presents a stock-flow model of growth for a closed economy that encompasses virtually all one-sector post-Keynesian growth models as special cases and uses it to analyse the The last (but not least) three chapters introduce institutions into the picture. Chapter 14, by Graziella Bertocchi, illustrates the ongoing research line which adds a historical and institutional dimension to economic growth analysis both at the theoretical and empirical level: it presents applications of this research strategy to the impact of colonization on growth, the extension of the franchise and the welfare state, the evolution of educational systems, the relationship between industrialization and democratization, and international migration. Chapter 15, by Michele Bagella, Leonardo Becchetti and Stefano Caiazza, argues that religious differences among countries are crucial determinants of the evolution of market rules and financial institutions; it shows that a positive link between institutions and growth arises only in those countries whose cultural background allowed them to reach a sufficient degree of institutional development and that the effect of institutions on growth is, for a significant part, exogenous. Chapter 16, by Gabriella Berloffa and Maria Luigia Segnana, questions the views that trade liberalization 'is always good for growth' and that 'growth is always good for the poor' and argues that the problem of poverty reduction cannot be separated from the context in which trade is liberalized. Almost all the chapters of this book as well as all the papers included in the special issue of Metroeconomica have been peer-reviewed (the exceptions are the invited lectures to the conference). I would like to take this opportunity to thank all the referees who contributed to improving the published papers and advised me of their publishability. The following scholars helped me with this task:
The Co-evolution of Technology and Institutions: Lessons from Past Industrial Revolutions ∗
2008
Evolutionary approaches are flourishing in explaining industrial revolutions, based on the view that the development of technology can be best understood as an evolutionary process (e.g., Basalla 1988). However, this view is further developed by scholars such as Langlois (1999), Pelikan (2003) or Mokyr (2002) who argue that technology co-evolves with institutions. By augmenting Pelikan’s (2003) framework, in this paper I will develop a general model of the co-evolution of technology and institutions. Then through the examples of the British and the Second Industrial Revolution, I will use this theoretical model as an ideal type to establish the particular features of these historical events. The significance of the historical analysis of the co-evolution of technology and institutions is twofold. First, it may provide us with a more precise understanding of the British and Second Industrial Revolution. Second, the lessons drawn from past industrial revolutions may give us guidelines...
Economic Themes, 2016
The aim of the research in this paper is to analyse the issue of the treatment of the category of technological changes within the main aspects of economic growth theory. The analysis of the key positions of neoclassical theory (Solow), endogenous approach (Romer), and evolutionary growth theory (Freeman) advocates has pointed to the conclusion that these approaches agree on the fact that the category of technological changes is a key generator of economic growth. Neoclassicists were the first to explicitly analyse the category of technological changes in growth theory. They exerted a strong influence on a large number of governments to allocate significant funds for scientific and research development, to stimulate the creation and diffusion of innovation. Supporters of endogenous theory also see the category of technological changes as a key driver of economic growth. Unlike neoclassicists, they emphasise the importance of externalities, in the form of technological spillover and ...
The Intellectual Origins of Modern Economic Growth
The Journal of Economic History, 2005
The intellectual origins of the Industrial Revolution are traced back to the Baconian program of the seventeenth century, which aimed at expanding the set of useful knowledge and applying natural philosophy to solve technological problems and bring about economic growth. The eighteenth-century Enlightenment in the West carried out this program through a series of institutional developments that both increased the amount of knowledge and its accessibility to those who could make best use of it. Without the Enlightenment, therefore, an Industrial Revolution could not have transformed itself into the sustained economic growth starting in the early nineteenth century. conomic growth was not a novelty in 1800. In a celebrated passage, Adam Smith had noted that the "annual produce of land and labour" had been growing in Britain for a long time. 1 Yet there is something distinctive in the changes that occurred in the economies of the West after the Industrial Revolution that seem to confirm our intuition that something genuinely important had happened. To be sure, technological innovations, institutional reforms, and fresh ideas do not affect the aggregate level of economic activity abruptly: they need to diffuse from region to region, from activity to activity, cross boundaries and seas, be evaluated, adapted, and refined. Their promoters have to dislodge the entrenched, persuade the
Technological Change and Economic Growth
Procedia - Social and Behavioral Sciences, 2015
In a globalizing world economy, the reason for differences in economic growth and inter-country income inequality is explained on the grounds of technological differences. The goal of science and technology is to enable enterprises and individuals to use technologies more efficiently, as this results in reduced costs and enhanced productivity gains. The use of new technologies paves the way for production of new cheaper goods and for capital accumulation and, for that matter, for an enhanced international competitiveness of individual countries, as well as to an enhanced quality for scientific research institutions, while, on the other hand, contributing to cultural and political development of societies. The quality of growth rates is as much important as their size. One may ask the following questions in order to get a better understanding of whether growth has its reflections on people's life or not: Are people involved and included in growth process? Does everybody enjoy the opportunities driven by growth? Do new technologies or trade volumes increase the choices facing people? Is welfare level of the future generations planned? Or, else, who is cared about is today's generations only? Are markets accessible and open to everybody?
A structuralist perspective on the role of technology in economic growth and development
World Development, 1991
This paper presents an integratcd view of what is termed a "structuralist'" perspective to economic growth and development that stands in contrast to the mainstream orthodox or neoclassical view. In the structuralist view, structural changes are causes of growth rather than outcomes of a process of capital accumulation and of rising per capita incomes. Moreover, the growth process may be punctuated by periods of discrete shifts in resource allocation ("creative destruction") and growth acceleration rather than being smooth throughout. Structural changes need not be automatic, they require a skill-specific infrastructure of new capabilities which, when established, generate new comparative advantages. Market failures may be pervasive due to problems of human capital accumulation, critical mass and discrete choice among alternative growth paths. Thus in addition to creating a favorable environment for business and assuring, through macroeconomic policy, adequate investment, successful growth may require an adequate industrial and technological policy, particularly at nodes of structural change. The paper surveys the structuralist insights appearing in the literature, starting with the early postwar economic development literature and including recently developed formal models. It also proposes a kinked or scalloped aggregate production function as a simple tool for structuralist analysis.
Historical Perspective of the Role of Technology in Economic Development
The focus of this paper is to investigate technology changes and influence on economies since the First Industrial Revolution. The First Industrial Revolution was the first point in time when both increase of GDP per capita and population occurred at the same time (avoiding the Malthusian trap). Thus the selected point in time. Furthermore, developments of the late 18th and 19th centuries have some common properties with development of new technologies today. Even though the process of technological change changed during this time, there are still some lessons to be learned from distant and near history on how to gauge policies for fostering successful technological advances. Changes that occurred are relevant for respective economies, industries, companies and individuals. On all these levels changes occurred that were unprecedented in history before the First Industrial Revolution. It is not suggested that technological progress of centuries before the First Industrial Revolution ...