Technological Systems And Industrial Dynamics

This volume consitutes a summary of several years' multi-disciplinary research by a group of Swedish researchers. The project 'Sweden's Technological Systems and Future Development Potential' was initiated by the Swedish National Board for Industrial and Technical Development (NUTEK) and has been carried out at the Department of Industrial Management and Economics at Chalmers University of Technology in Gothenburg, the Research Policy Institute at the University of Lund, the Industrial Institute for Economic and Social Research (lUI) in Stockholm, and the Department of Industrial Economics and Management at the Royal Insitute of Technology, Stockholm, under the direction of Bo Carlsson, Case Western Reserve University, Cleveland, Ohio. The project group decided early on to focus fIrst on the technological system for factory automation - a relatively mature system of great importance to Swedish industry and in which Sweden has reached a leading position internationally - and then to shift the attention to other systems in various stages of development and with varying Swedish strength. The work on factory automation resulted in numerous papers and publications, summarized in a volume published in 1995 (Technological Systems and Economic Performance: The Case of Factory Automation, ed. Bo Carlsson. Dordrecht.

The extent to which firms can react creatively to rather than adjust passively against new techniques and practices is dependent on their command of technological knowledge and relative competence. This book explores the characteristics of the path dependent dynamics of localized technological change, demonstrating how the economics of complexity can inform our understanding of the economics of innovation and vice versa. The book is structured in three parts: part one focuses on the ingredients of the economics of localized technological change, focusing on the legacies of the key economists and a critical assessment. Part two explores the governance of the generation, dissemination, use and exploitation of localized technological knowledge. Part three elaborates on the basic dynamic mechanisms of localized technological change, combining theory with specific empirical models. The final perspectives articulate the relations between the economics of localized technological change, the economics of path dependence and the challenge of the emerging economics of complexity.

The concept of localized technological change is emerging at the crossroads of different approaches to the economics of innovation and new technologies. The term `localized technological change' refers to the introduction of technological changes which make possible an increase in total factor productivity within only a limited range of techniques defined by the levels of factor intensity. This contrasts with `generalized technological change', which is defined as the global shift of all the techniques represented on the map of isoquants of the neoclassical tradition. The Economics of Localized Technological Change elaborates the notion of localized technology with respect to firms, factor substitution, sectors, regions and techniques. It also assesses the implications for industrial policy, technology and innovation policy. The book will be of interest to corporate policy makers, scholars of industrial organization and economics of innovation as well as business school students.

In 1987 the Swedish National Board for Technical Development (STU, later becoming the Swedish National Board for Industrial and Technical Development, NUTEK) initiated a study of Sweden's Technological Systems and Future Development Potential. A comprehensive, interdisciplinary study was envisioned, yielding not only useful insight but also a permanent competence base for future analyses of technological systems and technology policy in Sweden. Three leading Swedish research institutes were invited to participate: the Industrial Institute for Economic and Social Research in Stockholm, the Department ofIndustrial Management and Economics at Chalmers University of Technology in Gothenburg, and the Research Policy Institute at the University of Lund. I was invited to direct the project. The project group decided to focus initially on a particular technological system, namely factory automation, to be followed by similar studies of other systems. Numerous publications have resulted from the project thus far. The current volume represents a summary of our work on factory automation. It consists of several original essays and of some previously published papers which have been edited, in some cases substantially, in order to form a comprehensive and coherent picture of a technological system. To our knowledge, this is the first in-depth analysis of a technological system designed as a component of a systematic study of technological systems more generally. At the time of this writing, three further studies on electronics and computers, pharmaceuticals, and powder technology are under way, to be published in a later volume.

In 1987 the Swedish National Board for Technical Development (STU, later becoming the Swedish National Board for Industrial and Technical Development, NUTEK) initiated a study of Sweden's Technological Systems and Future Development Potential. A comprehensive, interdisciplinary study was envisioned, yielding not only useful insight but also a permanent competence base for future analyses of technological systems and technology policy in Sweden. Three leading Swedish research institutes were invited to participate: the Industrial Institute for Economic and Social Research in Stockholm, the Department ofIndustrial Management and Economics at Chalmers University of Technology in Gothenburg, and the Research Policy Institute at the University of Lund. I was invited to direct the project. The project group decided to focus initially on a particular technological system, namely factory automation, to be followed by similar studies of other systems. Numerous publications have resulted from the project thus far. The current volume represents a summary of our work on factory automation. It consists of several original essays and of some previously published papers which have been edited, in some cases substantially, in order to form a comprehensive and coherent picture of a technological system. To our knowledge, this is the first in-depth analysis of a technological system designed as a component of a systematic study of technological systems more generally. At the time of this writing, three further studies on electronics and computers, pharmaceuticals, and powder technology are under way, to be published in a later volume.

This book is based on the papers presented at a conference on "New Issues in Industrial Economics" held at Case Western Reserve University, Cleveland, Ohio, June 8-10, 1987. The conference was organized by the Research Program in Industrial Economics (RPIE) in the Department of Economics at CWRU and was sponsored by The Cleveland Foundation, the Eaton Corporation, and The Standard Oil Company (later renamed BP America, Inc.). Their generous support is gratefully acknowledged. All of the papers have been revised, in several cases extensively, since their presentation at the conference. One of the primary reasons for organizing the conference was the concern that Industrial Economics has become too narrowly focused in most academic programs, largely being confined to Industrial Organization, i.e., issues of public policy towards enterprise with emphasis on antitrust and regulatory policy. This subject definition leaves out a number of interesting and important questions about how industries evolve over time, what the role of technological change (and organizational change) is in that process, and the associated structural changes within industries and firms. The object of this book is to derme these issues and suggest a framework within which they can be analyzed. I would like to thank all the conference participants for their contributions, particularly my colleagues at CWRU, Asim Erdilek and William S. Peirce, without whose encouragement and support the conference would not have taken place.