View metadata, citation and similar papers at core.ac.uk brought to you by CORE provided by Simon Fraser University Institutional Repository GENERAL PURPOSE TECHNOLOGIES IN THEORY, APPLICATION AND CONTROVERSY: A REVIEW by Clifford Bekar, Kenneth Carlaw, Richard Lipsey Contacts Clifford Bekar:
[email protected] Kenneth Carlaw:
[email protected] Richard Lipsey:
[email protected] Abstract Distinguishing characteristics of General Purpose Technologies (GPTs) are identified and definitions discussed. Our definition includes multipurpose and single-purpose technologies, defining them according to their micro-technological characteristics, not their macro-economic effects. Identifying technologies as GPTs requires recognizing their evolutionary nature, and accepting possible uncertainties concerning marginal cases. Many of the existing ‘tests’ of whether particular technologies are GPTs are based on misunderstandings either of what GPT theory predicts or what such tests can establish. The development of formal GPT theories is outlined, showing that only the early theories predicted the inevitability of GPT-induced showdown and surges. More recent GPT theories, designed to model the characteristics of GPTs, do not imply the necessity of specific macro effects. We show that GPTs can rejuvenate the growth process without causing slowdowns or surges. We conclude that existing criticisms of GPT theory can be resolved and that the concept remains useful for economic theory. Key Words: General Purpose Technologies, technological change, patents, slowdowns, surges, growth theories, productivity JEL Classes: N00, O30, O33, O40, O41. 1 GENERAL PURPOSE TECHNOLOGIES IN THEORY, APPLICATIONS AND CONTROVERSY: A REVIEW1 Two main approaches to studying economic growth over the very long-run are found in the literature: the analysis of economic historians and the formal model building of economic theorists.