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The dynamic effects of general purpose technologies on Schumpeterian growth

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  • Iordanis Petsas

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Abstract

General purpose technologies (GPTs) are drastic innovations characterized by pervasiveness in use and innovational complementarities. The dynamic effects of a GPT are analyzed within a quality-ladders model of scale-invariant Schumpeterian growth. The diffusion path of a GPT across a continuum of industries is governed by S-curve dynamics. The model generates a unique, saddle-path long-run equilibrium. Along the transition path, the measure of industries that adopt the new GPT increases, consumption per capita falls, and the interest rate rises. The growth rate of the stock market depends negatively on the rate of GPT diffusion and the magnitude of the GPT-ridden R&D productivity gains; and positively on the rate of population growth. It also follows a U-shaped path during the diffusion process of the new GPT. Finally, the model generates transitional growth cycles of per capita GNP. Copyright Springer-Verlag Berlin/Heidelberg 2003

Suggested Citation

  • Iordanis Petsas, 2003. "The dynamic effects of general purpose technologies on Schumpeterian growth," Journal of Evolutionary Economics, Springer, vol. 13(5), pages 577-605, December.
  • Handle: RePEc:spr:joevec:v:13:y:2003:i:5:p:577-605
    DOI: 10.1007/s00191-003-0171-y
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    File URL: http://hdl.handle.net/10.1007/s00191-003-0171-y
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    Citations

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    Cited by:

    1. Petsas, Iordanis, 2009. "General Purpose Technologies and their Implications for International Trade," MPRA Paper 14446, University Library of Munich, Germany.
    2. Petsas Iordanis, 2015. "General Purpose Technologies and their Implications for International Trade," International Journal of Management and Economics, De Gruyter Open, vol. 47(1), pages 7-35, September.
    3. A. Rainer & R. Strohmaier, 2014. "Modeling the diffusion of general purpose technologies in an evolutionary multi-sector framework," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 41(3), pages 425-444, August.
    4. Slowak, André P., 2009. "Market fields structure & dynamics in industrial automation," FZID Discussion Papers 02-2009, University of Hohenheim, Center for Research on Innovation and Services (FZID).
    5. repec:eee:tefoso:v:125:y:2017:i:c:p:154-165 is not listed on IDEAS
    6. Daniel Schiess & Roger Wehrli, 2008. "The Calm Before the Storm? - Anticipating the Arrival of General Purpose Technologies," CER-ETH Economics working paper series 08/81, CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich.
    7. Afonso, Oscar & Bandeira, Ana Maria, 2013. "Effects Of International Diffusion Of A General Purpose Technology On Wage Inequality," Hitotsubashi Journal of Economics, Hitotsubashi University, vol. 54(2), pages 203-220, December.

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