Structural change and technology : a long view

Neo-Schumpeterians of the 1970s and 1980s argued for the concept of pervasive technological systems as one way of interpreting creative destruction. Pervasive technologies are basic innovations that find application in a wide variety of sectors in the economy. It has recently been suggested that the period of rapid economic growth in the 1990s in the United States can be explained by the rise of a set of technologies known as Information and Communication Technologies (ICT). Such an interpretation is certainly in broad accordance with the notions of Schumpeterian radical technological breakthroughs, creative destruction and pervasive technological systems. This paper provides an attempt to interpret this ICT ‘revolution’ from a Schumpeterian point of view, using input-output data and technology flow matrices for the US economy. The paper concludes with a broad discussion of the historic role of ICT in the US and world economy.