Oslo Summer School in Comparative Social Science Studies 2000
The Economics of Technological Change
Main discipline: Economics, Technology and Innovation Studies
Lecturer: Professor Bart Verspagen,
MERIT, University of Maastricht, the Netherlands
Plan of lectures
1. Technology as a production factor
Aim: to introduce the special features of technological knowledge as a production factor and economic good. Which problems does this cause for economic analysis?
- Arrow, K. J. (1962). "Economic Welfare and the Allocation of Resources for Invention". in: The Rate and Direction of Inventive Activity: Economic and Social Factors. New York, National Bureau of Economic Research: 609-625.
- Dosi, G. (1988). "Sources, Procedures and Microeconomic Effects of Innovation." Journal of Economic Literature 26: 1120-1171.
2. Research and development
Aim: to explore the nature of the research and development process, and to provide a historical background to this process.
- Kline, S. J. and N. Rosenberg (1986). "An overview of innovation" in:The positive sum strategy: harnassing technology for economic growth, in: R. Landau and N. Rosenberg. Washington DC, National Academic Press.
- Mowery, D. C. and N. Rosenberg (1989). Technology and the Pursuit of Economic Growth. Cambridge, Cambridge University Press, chapters 2-5.
3. Intellectual Property Rights (IPR) protection
Aim: to provide a discussion of the economic aspects of the patent system, and to introduce theory on optimal patent design (patent length, patent breadth).
- David, P. A. (1993). "Intellectual Property Institutions and the Panda's Thumb: Patents, Copyrights, and Trade Secrets in Economic Theory and History", in: Global Dimensions of Intellectual Property Rights in Science and Technology. M. B. Wallerstein, M. E. Mogee and R. A. Schoen (eds), Washington, D.C., National Academy Press: 19-64.
- Klemperer, P. (1990). "How broad should the scope of patent protection be?" RAND Journal of Economics 21: 113-130.
- Nordhaus, W. D. (1969). Invention, Growth and Welfare. A Theoretical Treatment of Technological Change. Cambridge MA: MIT Press, chapter 5.
4. Technology, market structure and diffusion
Aim: to introduce the basic microeconomic theory of innovation. This lecture will explore the issue of (endogenous) market structure, and the diffusion of technologies.
- Hall, P. (1994). Innovation, Economics & Evolution. New York, Harvester Wheatsheaf, chapter 6.
- Stoneman, P. (1991). "Technological Diffusion: the Viewpoint of Economic Theory. Innovation and Technology in Europe", in: From the Eighteenth Century to the Present. P. Mathias and J. A. Davis (eds), Oxford, Blackwell: 162-184.
- Reinganum (1989). "The timing of innovation: research, development , and diffusion". Handbook of industrial organization, volume I. R. Schmalensee and R. D. Willig. Amsterdam, Elsevier: 849-908.
5. The information economy: problems for theory?
Aim: to explore the question whether special characteristics (such as network externalities) of information and communications technologies (ICT) pose special problems for economic theory. Applications to the issue of market structure and innovation (the Microsoft case).
- Shapiro, C. and H. Varian (1999). Information rules : a strategic guide to the network economy. Boston, Harvard Business School Press, especially chapters 2, 5-7.
- Liebowitz, S. J. and S. E. Margolis (1999). Winners, losers & Microsoft: competition and anti-trust in high-technology, The Independent Institute, chapters 7-9.
6. Technology and (un)employment
Aim: to explore what the impact of various forms on (un)employment is. Special emphasis is on the expectations regarding the impact of ICT.
- Freeman, C. and L. Soete (1994). Work for all or mass unemployment. Computerised technical change into the 21st century. London, Pinter, chapters 2 and 3.
- Katsoulacos, Y. (1986). The Employment Effect of Technical Change. A theoretical study of new technology and the labour market. Brighton, Wheatsheaf, chapters, especially chapters 2-4.
7. Early innovation based theories of growth
Aim: to explore the impact of technology on economic growth. This lecture will survey some early theories and applications on this subject.
- Literature: Abramovitz, M. A. (1986). "Catching Up, Forging Ahead and Falling Behind." Journal of Economic History 46: 385-406.
- Fagerberg, J. (1988). "International Competitiveness." Economic Journal: 355-374.
- Fagerberg, J. (1988). "Why Growth Rates Differ" in: Technical Change and Economic Theory. G. Dosi, C. Freeman, R. R. Nelson, G. Silverberg and L. Soete. London, Pinter. 16: 87-99.
8. Endogenous growth theory
Aim: to extend the issue of growth and technology to the so-called endogenous growth theory that emerged in the late 1980s.
- Grossman, G. M. and E. Helpman (1991). Innovation and Growth in the Global Economy. Cambridge MA, MIT Press, chapter 3.
- Lucas, R. E. B. (1988). "On the Mechanics of Economic Development." Journal of Monetary Economics 22: 3-42.
9. Creative destruction and evolutionary economics
Aim: to investigate an alternative perspective on long-run growth and technology that considers fluctuations as a major aspect of growth.
- Literature: Fels, R. (1996). "Summary of Schumpeter's theory of the business cycle". Reprinted in: Long Wave Theory. C. Freeman. Aldershot, Edward Elgar.
- Nelson, R. R., S. G. Winter, et al. (1976). "Technical Change in an Evolutionary Model." Quarterly Journal of Economics XC: 90-118.
- Silverberg, G. and D. Lehnert (1994). "Growth fluctuations in an evolutionary model of creative destruction" in: The Economics of Growth and Technical Change. technologies, Nations, Agents. G. Silverberg and L. Soete. Aldershot, Edward Elgar: 74-108.
10. Technology and International trade
Aim: to explore the impact of technology on international trade.
- Wakelin, K. (1997). Trade and Innovation. Theory and Evidence. Aldershot, Edward Elgar, chapters 2 and 3.
- Krugman, P. (1990). Rethinking International Trade. Cambridge MA, MIT Press, especially chapter 7.
Professor Bart Verspagen is an economist specialized in the economics of technological change. He did his undergraduate studies at the University of Limburg in Maastricht, the Netherlands, from 1984 - 1988. After that, he obtained a PhD degree from the same university in 1992. During the five years after that, he held a scholarship from the Royal Netherlands Academy of Arts and Sciences (KNAW).
During these years, his workplace was the Maastricht Economic Research Institute on Innovation and Technology (MERIT). In 1998, he moved partly to the Eindhoven Centre for Innovation Studies (ECIS) at the Eindhoven University of Technology (TUE). Now, he is at ECIS for 3 days per week, and at MERIT for the other two days, both as research professor of the economics of technological change.