ABSTRACT
The fluctuations in American economic activity in the twentieth century raise the following question: Is there any connection between innovation and economic activity? During the Depression of the 1930s, many people believed that labor-saving innovations were responsible for a large part of the unemployment problem and that new products were introduced too slowly to absorb these displaced workers. We must look at the issue more broadly, however, by asking when and why innovation occurred in both the booming 1920s and the depression years of the 1930s, and what impact it had on the economy.
