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Demand-pull, technology-push, and the direction of technological change

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  • Hötte, Kerstin

Abstract

This paper studies the impact of Demand-pull (DP) and Technology-push (TP) on growth, innovation, and the factor bias of technological change in a two-layer network of input–output (market) and patent citation (innovation) links among 307 6-digit US manufacturing industries in 1977–2012. Two types of TP and DP are distinguished: (1) DP and TP are between-layer spillovers when market demand shocks pull innovation and innovation pushes market growth. (2) Within-layer DP arises if downstream users trigger upstream innovation and growth, while TP effects spill over from up- to downstream industries. The results support between- and within-layer TP: Innovation spillovers from upstream industries drive market growth and innovation. Within the market, upstream supply shocks stimulate growth, but this effect differs across industries. DP is not supported but shows a factor bias favoring labor, while TP comes with a shift towards non-production work. The results are strongest after the 2000s and shed light on the drivers of recent technological change and its factor bias.

Suggested Citation

  • Hötte, Kerstin, 2023. "Demand-pull, technology-push, and the direction of technological change," Research Policy, Elsevier, vol. 52(5).
    • Handle: RePEc:eee:respol:v:52:y:2023:i:5:s0048733323000240
    DOI: 10.1016/j.respol.2023.104740
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    Keywords

    Technological change; Network; Patent; Input–output; Innovation; Labor;
    All these keywords.

    JEL classification:

    • E23 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Production
    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
    • L6 - Industrial Organization - - Industry Studies: Manufacturing
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights

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