Chapter 13 (Freeman ? Soete)
• Economists have long recognized the importance of science and technology for long-term economic growth and productivity. Growth theory has traditionally recognized the crucial role of knowledge accumulation in the growth process.
• In the long run, the pattern of growth at the world level seems to have been characterized by an “explosion” of diverging growth trends. Before the Industrial Revolution, the income gap between the poorest and the richest country in the world was not very high, but industrialization has increased that gap dramatically. Economic historians have focused on these diverging, long-term growth paths. Many of them have attempted to explain these in terms of differences in countries’ success in using science and technological advances more efficiently or better than other countries. Abramovitz (1986) first introduced the distinction between “forging ahead”, “catching up” and “falling behind” in economic growth.
o The two major examples of “forging ahead” are the UK in the nineteenth century and the USA in the twentieth century. Germany was “forging ahead” in the chemical industry.
o An increasing number of Asian countries is “catching up”.
• Maddison has identified a few phases of economic growth.
o 1890-1913:
? “entrepreneur-driven” output growth
? international technological convergence
? international convergence in GDP per capita
? loose links between technological variables and growth rates
o 1913 ? 1929:
? direct link between innovativeness and income growth
? divergence in GDP per capita
o Great Depression and Second World War:
? d ...