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Effects of re-invention on industry growth and productivity: evidence from steel refining technology in Japan, 1957--1968

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  • Tsuyoshi Nakamura
  • Hiroshi Ohashi

Abstract

This paper examines the economic impact of re-invention -- the degree to which an innovation is modified by user -- on industry growth and productivity. The paper focuses on two re-inventions made by a Japanese steel company; these inventions improved the productive efficiency of Austrian-made refining technology, namely basic oxygen furnace (BOF). Results obtained from the plant-level production function estimation indicate that re-inventions account for approximately 30% of the total factor productivity of the BOF, substantially promoting the dissemination of the BOF technology. Our simulation analysis indeed reveals that re-inventions contributed to steel output growth by about 14%. This paper also documents that innovating companies played the role of a ‘lead user’ in developing and disseminating their re-invented technologies.

Suggested Citation

  • Tsuyoshi Nakamura & Hiroshi Ohashi, 2012. "Effects of re-invention on industry growth and productivity: evidence from steel refining technology in Japan, 1957--1968," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 21(4), pages 411-426, June.
    • Handle: RePEc:taf:ecinnt:v:21:y:2012:i:4:p:411-426
    DOI: 10.1080/10438599.2011.602538
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    1. Samuel Hollander, 1965. "The Sources of Increased Efficiency: A Study of DuPont Rayon Plants," MIT Press Books, The MIT Press, edition 1, volume 1, number 026258235x, April.
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    Cited by:

    1. Lee, Keun & Ki, Jee-hoon, 2017. "Rise of latecomers and catch-up cycles in the world steel industry," Research Policy, Elsevier, vol. 46(2), pages 365-375.
    2. Ryuki Kobayashi, 2023. "The effects of new technology on productivity: technological improvement and reallocation efficiency in the Japanese steelmaking industry," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 12(1), pages 1-24, December.
    3. Lee, Keun, 2019. "Economics of Technological Leapfrogging," MPRA Paper 111034, University Library of Munich, Germany.
    4. Takano, Keisuke & Okamuro, Hiroyuki, 2020. "Place-based SME finance policy and local industrial revivals: An empirical analysis of a directed credit program after WW2," TDB-CAREE Discussion Paper Series E-2020-01, Teikoku Databank Center for Advanced Empirical Research on Enterprise and Economy, Graduate School of Economics, Hitotsubashi University.

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