University of Vermont Economics 260: Technological Change and Capitalist Development

Transcription

1 University of Vermont Economics 260: Technological Change and Capitalist Development Fall 2010 Tuesday & Thursday, 11:30-12:45 Old Mill 221 Professor Ross Thomson Office: Old Mill Room Phone: Office Hours: Tuesday, Thursday, 10:00-11:00; by appointment The topic. Capitalism has generated ongoing technological change since the Industrial Revolution of the 18 th century. Technological change, in turn, has been a principal driving force of capitalist economies. This writing-intensive seminar will examine the relation of technological change and capitalist development historically. We will explore why capitalist economies have been so proficient in generating productivity growth, and why technological change accelerated economic growth. The particular focus of the course will be on the persistence of technological change in very different institutional settings. Technological change since World War 2 has involved intensive research and development (R&D) both privately and publicly financed, with powerful government roles in funding scientific advance and university education. This system varies greatly from innovation earlier in the century, in which Second Industrial Revolution technologies developed with less reliance on government funding and on organized R&D. Innovation in the First Industrial Revolution rested even less on the government, large firms, and R&D, raising the question of how ongoing change began. The transitions between systems also will be explored. How did innovation persist in such different settings? How did it evolve from one setting to the next? A final set of issues concerns the spread of new techniques across countries. How did the organization of innovation affect how it spread among countries? Were some organizations more conducive to catching-up by latecomers? In examining these questions, we will study both microeconomic and macroeconomic explanations of technological change, including those relating technical change to diffusion, the size and growth of demand, research and development, industrial structure, managerial organization, learning, competition, and uneven development among nations. We will integrate theoretical, historical, and policy perspectives on these issues. Organization. After posing the core questions, the seminar examines the historical development and importance of technology, considers its microeconomic and macroeconomic aspects and pertinent public policy, and moves to student research. The first part of the course explores basic approaches to technological change. The second part examines the historical development of technology from the Industrial Revolution through the present, focusing primarily on the United States, with some attention to Europe, Japan, and other countries. The third part investigates the firm and the microeconomics of innovation. The fourth concentrates on the

2 aggregate pace and unevenness of technological change. The third and fourth parts both consider how and with what limits the government can affect the pace and organization of innovation. The course then focuses on student research and topics related to it. Requirements. As a research seminar, this course will rely heavily on student participation, including several required presentations, and extensive student research. The seminar has six requirements, listed below together with their share in the final grade and approximate date (which may change as the semester progresses): Technology Essay 20% Thursday, Sept. 30 Economics of Innovation Essay 25% Thursday, Oct. 28 Research paper proposal 5% Thursday, Nov. 4 Research paper first draft 10% Thursday, Nov. 18 Research paper final draft 25% Monday, Dec. 13 Class participation 15% Throughout The technology essay explores the genesis of two technologies, one with organized R&D and the other without; as such it will point to differences in the ways in which technological change has been generated. The economics of innovation essay will involve some aspect of the theory of technological change pertinent to understanding technological change and its consequences. The research paper will involve an issue in historical or contemporary technological change and its consequences. It will address how a technological change came to be (or failed to become) ongoing. You can pick a technology and interpret its development and consequences, examine a country, or focus on an institution or public policy. The paper begins with a 500 word proposal, continues with a first draft, and concludes with a final draft. Class participation involves a) ongoing student groups to answer a discussion question, interpret a reading, or participate in a debate, b) regular participation in class discussions, and b) critiquing the proposals of students in your research group. Readings include two books and a series of articles and book excerpts available on the course blackboard site. The books are: David C. Mowery and Nathan Rosenberg, Paths of Innovation: Technological Change in 20 th Century America (Cambridge: Cambridge University Press, 1998). Chris Freeman and Luc Soete, The Economics of Industrial Innovation, third edition (Cambridge, Mass.: MIT Press, 1997).

3 Course Outline and Readings I. Introduction: Approaches to Technological Change and its Importance A. The Problem and Two Early Approaches Chris Freeman and Luc Soete, The Economics of Industrial Innovation, third edition, Adam Smith, The Wealth of Nations, Book I, ch Nathan Rosenberg, "Karl Marx on the Economic Role of Science," Perspectives on Technology, ch. 7. Ross Thomson, "Economic Structure and Technological Change: Marx and Beyond." Research in Political Economy, vol. 15 (1996), B. Twentieth Century Approaches: Evolution and Appropriability Joseph Schumpeter, The Process of Creative Destruction, Capitalism, Socialism, and Democracy, ch. 7. Richard R. Nelson, Capitalism as an Engine of Progress, The Sources of Economic Growth, Freeman and Soete, II. Chapters in Technological Change and Capitalist Evolution A. The Industrial Revolution Joel Mokyr, Industrial Revolution, in The Oxford Encyclopedia of Economic History, vol. 3, Joel Mokyr, The Lever of Riches, Freeman and Soete, B. American Ascendance Richard R. Nelson and Gavin Wright, "The Rise and Fall of American Technological Leadership: The Postwar Era in Historical Perspective," Journal of Economic Literature, December 1992, Michael H. Best, American System of Manufactures, The New Competition, Nathan Rosenberg, Technological Change in the Machine Tool Industry, , Journal of Economic History, December 1963, Ross Thomson, Structures of Change in the Mechanical Age: Technological Change in the United States, , chapter 8. Carolyn C. Cooper, Social Construction of Invention through Patent Management: Thomas Blanchard s Woodworking Machinery, Technology and Culture, October 1991, 960-

4 985. C. The Second Industrial Revolution Freeman and Soete, ch. 3 and 6. Robert C. Allen, Collective Invention, Journal of Economic Behavior and Organization, March 1983, David C. Mowery and Nathan Rosenberg, Paths of Innovation: Technological Change in 20 th Century America, ch. 3. D. R&D and Science-based Technology in the 20 th Century Mowery and Rosenberg, ch. 2. Nelson and Wright, The Rise and Fall of American Technological Leadership, E. Science-based Technologies: Electricity and Chemicals Mowery and Rosenberg, ch. 4, 5. Freeman and Soete, ch. 3 and 4. F. Science-based Technologies: Electronics and the Computer Mowery and Rosenberg, ch. 6. Freeman and Soete, ch. 7. III. The Microeconomics of Innovation and Capitalist Development A. Demand, Supply and Innovation Jacob Schmookler, "Economic Sources of Inventive Activity," The Journal of Economic History, March 1962, Nathan Rosenberg, Science, Innovation, and Economic Growth, Perspectives on Technology, Freeman and Soete, ch. 8. Nelson, "The Link between Science and Invention: The Case of the Transistor, The Sources of Economic Growth, B. Innovation and the Firm Edith Penrose, Specific Opportunities for Diversification, The Theory of the Growth of the Firm, Alfred Chandler, Scale, Scope, and Organizational Capabilities, Scale and Scope, Naomi Lamoreaux, Daniel M. G. Raff, and Peter Temin, Beyond Markets and Hierarchies: Towards a New Synthesis of American Business History, American Historical Review, 108 (April 2003), pp

5 Michael Best, The Entrepreneurial Firm in Japan, The New Competition, ch. 5. Nelson, "Why Do Firms Differ, and How Does It Matter?" The Sources of Economic Growth, Freeman and Soete, ch. 11. C. Innovation: Learning and Appropriation F. M. Scherer, New Perspectives on Economic Growth and Technological Innovation, Freeman and Soete, ch. 10, Thomson, Economic Structure and Technological Change, Roberto Mazzoleni and Richard R. Nelson, "Economic Theories about the Benefits and Costs of Patents," Journal of Economic Issues, 22: 1998, Nelson, "American Universities and Technical Advance in Industry, The Sources of Economic Growth, IV. The Macroeconomics of Innovation and Capitalist Development A. National Systems of Innovation Freeman and Soete, ch. 12, Richard R. Nelson, National Innovation Systems: A Retrospective on a Study, The Sources of Economic Growth, Mowery and Rosenberg, ch. 2 (review). Michael Dertouzos, Richard K. Lester, and Robert M. Solow, Failures of Cooperation, Made in America, B. Technology and Growth Freeman and Soete, ch. 13. Angus Maddison, Acceleration, Slowdown, and Convergence after 1950, Dynamic Forces in Capitalist Development, ch. 5. Nicholas Kaldor, Causes of the Slow Rate of Growth of the United Kingdom, C. Technological Leadership and Lock-ins Paul David, The Computer and the Dynamo, American Economic Review, 90 (1990) Nathan Rosenberg, "Chemical Engineering as a General Purpose Technology," General Purpose Technologies and Economic Growth, ed, Elhanan Helpman, Paul David, Clio and the Economics of QWERTY, American Economic Review 75 (May 1985),

6 D. Trade, Learning, and Convergence Freeman and Soete, ch. 15, Moses Abramovitz and Paul A. David, Convergence and Deferred Catch-Up: Productivity Leadership and the Waning of American Exceptionalism, in The Mosaic of Economic Growth, ed. By Ralph Landau, Timothy Taylor, and Gavin Wright, Alice H. Amsden, Speeding up, The Rise of The Rest, E. Technology and Public Policy Freeman and Soete, ch. 16, , ; ch. 17.