Technology, innovation and economic growth in Britain since 1870

Abstract

This chapter examines technological change in Britain over the last 140 years. It analyzes the effects of patent laws and innovation prizes that were designed to promote technical progress. It explores the challenge associated with the changing organizational structure of innovation and the shift from independent invention to R&D activity taking place inside the boundaries of firms. And it also studies the development of British industrial science in universities and efforts to promote innovation through the formation of industry clusters. Overall, the evidence supports the traditional story of British failure in generating large payoffs from technological development. Although from the early 1970s Britain experienced a revival in the quality of innovation and improved productivity growth, structural weaknesses in the commercialization environment still remain.

Independent invention in Italy during the Liberal Age, 1861–1913

“…Our results are also consistent with the recent findings reported in Nicholas, ‘Technology’, tab. 7.1, p. 187.…”

British relative economic decline in the aftermath of German unification

“…This is where an approach based on endogenous growth might undermine McCloskey's position especially in the context of the 2 nd industrial revolution as technological progress became increasingly science-based. The UK's technological performance was mediocre as is confirmed by the patenting data (Nicholas, 2014). While in 1883 the UK share of foreign patents in the United States was 34.6 per cent against 18.7 per cent for Germany by 1913 the UK share was 23.3 per cent compared with 34.0 per cent Germany's (Pavitt and Soete, 1982).…”

Sooner than you think: the Pre-1914 UK Productivity Slowdown was Victorian not Edwardian

“…In particular, choices of technique were nearly always correct (Magee, 2004), foreign investment was profitable and new industries were not unduly neglected by the capital market (Chabot and Kurz, 2010) while the specialized British banking system worked well (Chambers, 2014). Much more questionable, however, is the UK's technological performance as, for example, the data on patenting confirm (Nicholas, 2014). More speculatively, an endogenous-growth perspective might suggest that a stronger commitment by government to fostering a 'knowledge economy' could have raised the growth rate and relaxed the supply-side constraint invoked by McCloskey.…”