Template-type: ReDIF-Paper 1.0
Author-Name: Antonelli, Cristiano
Author-Email: cristiano.atonelli@unito.it
Author-Workplace-Name: University of Turin
Author-Workplace-Homepage: http://www.est.unito.it/
Title: Localized Technological Change and Factor Markets: Constraints and Inducements to Innovation.
Abstract: The recent advances in the economics of innovation and the analysis of how composition effects influence 
the introduction of technological change in a global economy, characterized by the variety of production functions 
in use and different local factor markets, provide new strength to the induced innovation approach. Developing the 
localized technological change approach, it is argued that because there are irreversibilities, limited knowledge 
and local learning, the introduction of new technologies is induced by the disequilibrium conditions brought about 
in each system by all changes in relative factor prices. The direction of technological change in terms of its 
specific form of bias and how it is introduced and adopted, however, reflects the specific conditions of local 
factor markets. Well-defined long-term technological paths emerge in each region and they depend on the selection 
process in product markets. The more rigid and idiosyncratic, the endowment of production factors and the system of
 relative prices are, the more specific the technological path of each region is likely to be. 
The divide between the microeconomic and the macroreconomic models of induced technological change is reconciled. 
Length: 35 pages
Creation-Date: 2005-10
File-URL: http://www.est.unito.it/do/home.pl/Download?doc=/allegati_wp/wp2005dip_l_b/3_wp_momigliano.pdf
File-Format: Application/PDF
Handle: RePEc:uto:labeco:200503