chapter  1
6 Pages

Introduction

Capital goods have long fascinated classical economists and scholars of innovation studies in connection with technological innovation and pro­ ductivity growth. They have laid the capital goods sector at the centre of the generation and the diffusion of technological innovation. At the same time, the innovation of capital goods has been featured as an important source of the viability and flexibility of industrial economies, because a large number of industrial sectors invariably require improved and inno­ vated capital goods for their productivity growth. The existence of a welldeveloped capital goods sector possessing the technical knowledge, skills and facilities to innovate machinery has been frequently regarded as one of the critical factors determining the borderline between developed coun­ tries and developing countries.