ABSTRACT
There is little doubt that technological change has been a major force in promoting economic growth over the last two centuries. Just how important is a matter for debate. Some economists have argued that it has been far more significant than simply the increased employment of capital and labour. Evidence is mounting to suggest that this is an exaggerated view and that we ought to maintain the emphasis that earlier analysts gave to variables such as the ratio of savings to national income. But however that may be, technology has clearly played a most important role in many aspects of growth — not just in raising incomes but in changing the location and size of industry, in altering the role of different raw materials, in changing social patterns of work, in altering for good and ill the quality of life itself. As for capital we must, at least, stress the importance of determining the amount of technological advance incorporated when any investment is made. Technology embraces in these contexts a wide range of activities. It may mean a new process of manufacture or a new final product. In some circumstances it can better be described as ‘know-how’ — the ability to organise and operate plant within the existing range of technological knowledge. It involves all those supplementary benefits accruing from the expansion of centres of industrial activities known as external economies. It includes the economies reaped from increases in the scale of activity and the greater efficiency derived from the process of learning a job by doing it again and again. It relates, too, to the quality of the workforce at all levels.
