Table of Contents

Innovation, Evolution and Economic Change

Innovation, Evolution and Economic Change

New Ideas in the Tradition of Galbraith

New Directions in Modern Economics series

Edited by Blandine Laperche, James K. Galbraith and Dimitri Uzunidis

The book begins with a penetrating analysis of the main features of today’s capitalism and in particular the conflict between shareholders and managers. It moves on to focus on the consequences of globalization in the decision-making processes of large corporations and represents an important step in the development of a theory of fraud and corruption within corporations. In the final part, the authors address and explore the consequences of the domination of influential groups over major social and political decisions, on the blurred boundaries between the public and the private sectors and its consequences in the fields of technological regulation and the evolution of public services. In so doing, the authors question the meaning and power of democracy in today’s society.

Chapter 11: Galbraith and the Political Economy of Technological Innovation: Critical Perspectives and a Heterodox Synthesis

Jerry Courvisanos

Subjects: economics and finance, economic psychology, economics of innovation, history of economic thought, innovation and technology, economics of innovation


Jerry Courvisanos 1. INTRODUCTION In The New Industrial State (NIS), Galbraith (1967) develops a unique approach to understanding the management of technological innovation. It is based on a critical evaluation of the decision-making processes of economic agents within institutions and how they react to the different levels of political power in society. This political economy (PE) approach to technological innovation is the overriding theme of this chapter and is in direct contrast to the plethora of books and articles that provide a technocratic approach to managing technological innovation.1 There has been an appalling lack of any PE analysis of technological innovation in the spirit of Galbraith since NIS. Kingston (1984) is one notable excellent exception. The extremely poor level of citation of the Kingston book in the 20 years after its publication is a reflection not of the quality of the work, but with the obsession with technocratic issues within the business management discipline. In the meantime, mainstream neoclassical economics refuses to look inside what Rosenberg calls ‘the black box’ of technological innovation despite all economists recognizing the crucial role that it plays in economic development.2 Technological innovation has many definitions in the innovation literature. For the purposes of this chapter, the following is most appropriate: The creation, development and implementation of an idea from problem-solving or opportunity identification that alters (innovation) the current state of theoretical and practical knowledge, skills and artefacts in the production and delivery of economic activity (technology). Technology here refers to any production and delivery...

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