A central, yet little-researched, contributor to technology's advance and economic growth is "disruptive" technological change, which replaces older technologies and products with newer ones. Examples include electronic calculators replacing mechanical calculators, smaller hard disk drives replacing larger drives, or new generations of photolithographic aligners for semiconductor manufacture. Such technology disruption is considered a crucial influence on industries, has been shown to endanger businesses, and is central to the manner in which many new technologies contribute to societal welfare and economic growth.
Intellectual Merit: This research measures, for the first time, the frequency of disruptive technological change across a broad group of industries. It also assesses specific processes and impacts of disruption in a sample of industries. The research analyzes 47 narrowly defined, product-level industries, representative of various types of U.S. manufacturing, from approximately 1900 to 2010. Jointly analyzed are related industries that fulfilled similar purposes for buyers. Intensive data collection is necessary to develop longitudinal measures of, in part, business entry and exit, market share, and patented and non-patented technologies. Data are being collected with the aid of two teams of summer research assistants, painstakingly assembling evidence primarily from library and archival sources. The frequency of disruptive technological change is being assessed using alternative definitions of disruption, ranging from the replacement of incumbent producers by new entrants to the internal development of new technologies and products by leading incumbent producers. Specific theories of disruptive technological change are simultaneously being probed in many industries, through in-depth analysis of sources including historical, technological, and trade literatures.
Broader Impact: Knowing the frequency of disruptive technological change is essential to properly understand how technology is advancing the economy, and this frequency is being determined for the first time across many U.S. industries. Fruitful policy insights may result, since the research improves fundamental understanding of entrepreneurship, corporate policy, and technological change. Understanding the interactions of entrepreneurs, businesses entering from other industries, and incumbent producers during technological disruptions is key to understanding how policies might enhance economic growth.
