Technological evolution as creative destruction of process heterogeneity: evidence from US plant level data

Description/Abstract

Change in evolutionary economics is predicated on the creative destruction of variety. Despite the importance of the concept of variety, or heterogeneity, in evolutionary economic theory, empirical work that examines the character of variety – its extent and its persistence – is still scarce. Drawing on unpublished, micro-level data from the US Bureau of the Census, this paper examines the characteristics of process heterogeneity in selected US manufacturing industries. More specifically the paper has three goals. First, to demonstrate that heterogeneity in plant technologies exists and that it persists over time even within relatively mature industrial sectors. Second, to examine the veracity of the processes that generate and destroy heterogeneity in production technology within narrowly defined industries. Third, to link the heterogeneity of plant-level techniques of production to the pace and direction of technological change at the level of the industry.