chapter  1
18 Pages

Uncertainty and Technological Change

I would like to begin with two generally accepted propositions about technological change: it is a major ingredient of long-term economic growth, and it is characterized by a high degree of uncertainty. Understanding the nature of these uncertainties and the obstacles to surmounting them is not a trivial matter. Rather, it goes to the heart of how new technologies are devised, how rapidly they diffuse, the ultimate extent of that diffusion, and their eventual impact on economic performance and welfare.