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Doctor of Philosophy / Since the 1950s, economic growth has been one of the main topics of economic discipline. In this context, the sources of economic growth have been analysed by different economic theories. These theories can be decomposed into two groups, namely modern neoclassical theory and evolutionary economic theory. In the modern neoclassical economic theory, the technological progress is considered as the main determinant of the long-run economic growth. In this regard, the sources of economic growth differences among countries are analyzed by using various types of models. In the earliest studies, it is assumed that technological progress is exogenous (Solow-Swan model). Constant returns to scale and perfectly competitive market structure assumptions are the main characteristics of these studies. After the developments in the economic theory, technological progress has been taken into account in a different way by a new line of models, namely endogenous growth models. More specifically, technological progress is endogenously determined process in these models. Contrary to the previous models, increasing returns to scale, which stem from externality and the monopolistic market structure, play a significant role in endogenous growth models. We have reached to the conclusion that, although it suffers from some weaknesses, endogenous growth model proposes a more realistic explanation for the economic growth process. In the evolutionary economic theory, technological progress is also considered as the main determinant of economic growth. However, this theory deals with empirical issues by focusing on observed facts instead of constructing theoretical models, and provides both guidance and interpretation regarding technological progress. In this theory, variables and relationships that are considered have many practical implications. In that respect, its structure is very much realistic and it avoids certain logical gaps and inconsistencies. One of the aims of this thesis is to examine developments in economic theory by focusing on technological progress. For this purpose, we compare formal and evolutionary theories. Our theoretical review reveals that both the endogenous growth models in the tradition of modern neoclassical theory, and the important insights of the evolutionary economic theory help to analyze technological progress and/or economic growth. Furthermore, this thesis aims to measure technological progress. The measurement of technological progress is vital for the nations’ development strategies and the firms’ innovation policies. In this regard, we use patent statistics as a proxy of technological progress. The empirical parts of the thesis involve a number of applications of endogenous growth theory by taking into account the propositions of modern neoclassical economic theory. In this regard, the growth rate differences across countries are examined by using the frameworks of both the modern neoclassical and evolutionary theories. The results show that both theories have reasonable power to explain why growth rate differs across countries. In addition, we conclude that patenting activities rather than R&D activities more suitably represent innovative activities. Moreover, this thesis empirically tests the knowledge generation process in the framework of endogenous growth approach. We employ the knowledge production approach for this purpose. It is found that both domestic and international stocks of knowledge as measured by granted patent statistics, R&D activities, human capital and openness measures are significant factors in explaining productivity growth. Furthermore, product variety and quality improvement dimensions of technological progress are empirically analyzed by using patent statistics. It is found that both dimensions of technological progress significantly affect creation of new technologies. Finally, the findings indicate that technological capability of Turkey is far away from other developed countries covered by this study.

Doctor of Philosophy / Since the 1950s, economic growth has been one of the main topics of economic discipline. In this context, the sources of economic growth have been analysed by different economic theories. These theories can be decomposed into two groups, namely modern neoclassical theory and evolutionary economic theory. In the modern neoclassical economic theory, the technological progress is considered as the main determinant of the long-run economic growth. In this regard, the sources of economic growth differences among countries are analyzed by using various types of models. In the earliest studies, it is assumed that technological progress is exogenous (Solow-Swan model). Constant returns to scale and perfectly competitive market structure assumptions are the main characteristics of these studies. After the developments in the economic theory, technological progress has been taken into account in a different way by a new line of models, namely endogenous growth models. More specifically, technological progress is endogenously determined process in these models. Contrary to the previous models, increasing returns to scale, which stem from externality and the monopolistic market structure, play a significant role in endogenous growth models. We have reached to the conclusion that, although it suffers from some weaknesses, endogenous growth model proposes a more realistic explanation for the economic growth process. In the evolutionary economic theory, technological progress is also considered as the main determinant of economic growth. However, this theory deals with empirical issues by focusing on observed facts instead of constructing theoretical models, and provides both guidance and interpretation regarding technological progress. In this theory, variables and relationships that are considered have many practical implications. In that respect, its structure is very much realistic and it avoids certain logical gaps and inconsistencies. One of the aims of this thesis is to examine developments in economic theory by focusing on technological progress. For this purpose, we compare formal and evolutionary theories. Our theoretical review reveals that both the endogenous growth models in the tradition of modern neoclassical theory, and the important insights of the evolutionary economic theory help to analyze technological progress and/or economic growth. Furthermore, this thesis aims to measure technological progress. The measurement of technological progress is vital for the nations’ development strategies and the firms’ innovation policies. In this regard, we use patent statistics as a proxy of technological progress. The empirical parts of the thesis involve a number of applications of endogenous growth theory by taking into account the propositions of modern neoclassical economic theory. In this regard, the growth rate differences across countries are examined by using the frameworks of both the modern neoclassical and evolutionary theories. The results show that both theories have reasonable power to explain why growth rate differs across countries. In addition, we conclude that patenting activities rather than R&D activities more suitably represent innovative activities. Moreover, this thesis empirically tests the knowledge generation process in the framework of endogenous growth approach. We employ the knowledge production approach for this purpose. It is found that both domestic and international stocks of knowledge as measured by granted patent statistics, R&D activities, human capital and openness measures are significant factors in explaining productivity growth. Furthermore, product variety and quality improvement dimensions of technological progress are empirically analyzed by using patent statistics. It is found that both dimensions of technological progress significantly affect creation of new technologies. Finally, the findings indicate that technological capability of Turkey is far away from other developed countries covered by this study.

We live in an age of rapid change. The advance of science and technology, throughout history, has culminated in periods of transition when social values have had to adapt to a changed environment. Such times have proved fertile ground for the expansion of the imagination. Utopian literature offers a vast archive of information concerning the relationship between scientific and technological progress and social change. Alterations in the most basic machinery of society inspired utopian authors to write of distant and future worlds which had achieved a state of harmony and plenty. The dilemmas which writers faced were particular to their era, but there also emerged certain universal themes and questions: What is the best organisation of society? What tools would be adequate to the task? What does it mean to be human? The dividing line on these issues revolves around two opposed beliefs. Some perceived the power inherent in technology to effect the greatest improvement in the human condition. Others were convinced that the organisation of the social order must come first so as to create an environment sympathetic to perceived human needs. There are, necessarily, contradictions in such a division. They can be seen plainly in More's Utopia itself. More wanted to see new science and technique developed. But he also condemned the social consequences which inevitably flowed from the process of discovery. These consequences led More to create a utopia based on social reorganisation. In the main, the utopias of Francis Bacon, Edward Bellamy and the later H. G. Wells accepted science, while the work of William Morris, Aldous Huxley and Kurt Vonnegut rejected science in preference for a different social order. More's Utopia and Bacon's New Atlantis were written at a time when feudal, agriciTfural society wasbeeing transformed by new discoveries and techniques. In a later age, Bellamy's Looking Backward and Morris's News From Nowhere offer contrary responses to society at the height of the Industrial evolution. These four authors serve as a prelude to the main area of the thesis which centres on the twentieth century. Wells, though his first novel appeared in 1895, produced the vast bulk of his work in the current century. Huxley acts as an appropriate balance to Wells and also exemplifies the shift from utopia to dystopia. The last section of the thesis deals with the work of Kurt Vonnegut and includes an interview with that author. The twentieth century has seen the proliferation of dystopias, portraits of the disastrous consequences of the headlong pursuit of science and technology, unallied to human values. Huxley and Vonnegut crystallised the fears of a modern generation: that we create a soulless, mechanised, urban nightmare. The contemporary fascination with science in literature is merely an extension of a process with a long tradition and underlying theme. The advance of science and technology created the physical and intellectual environment for utopian authors which determined the form and content of their visions.

This thesis covers a broad range of topics in the general area of economic growth theory and economics of technological change. It is primarily about the ultimate sources of growth and its ultimate limitations. We scrutinize the implications of several specifications of long-run growth "engines" which can be found across the theoretical literature and put forward their generalizations and extensions. At the highest level of generality, we provide a formal proof that balanced (i.e. exponential) growth requires knife-edge assumptions which cannot be satisfied by typical values of model parameters. This result implies that at least one such knife-edge assumption must be made if a given model is supposed to deliver balanced growth over the long run. Next, we deal with the issue of resource-based limits to long-run growth. We propose to promote technological progress which would improve the substitutability between non-renewable and renewable resources: if the elasticity of substitution between the two kinds of resources exceeds unity, production will not fall down to zero even after the non-renewable resources will have been completely depleted. Factor-augmenting technological progress can also be helpful, but its effects are much less pronounced and it must go on forever in order to assure sustainable production. Another question asked is whether it is plausible that R&D-based growth, fueled by steady increases in the world’s population, can be extended into indefinite time. We answer this question by introducing endogenous fertility choice, with population entering the utility functional multiplicatively, into an R&D-based semi-endogenous growth model. The next issue addressed here are the idea-based microfoundations of aggregate production functions. We discuss the correspondence between the shape of production functions, the direction of technical change, and the possibility of sustained endogenous growth. A broad class of production functions, nesting both the Cobb-Douglas and the CES function, is derived. Finally, we discuss the impact of the heterogeneity of innovations on long-run economic dynamics: we extend the semi-endogenous growth model with a distinction between radical and incremental innovations. Total R&D output is assumed to depend on technological opportunity which is depleted by incremental innovations but renewed by radical innovations. The dynamic interplay of the arrivals of the two types of innovations is shown to give rise to oscillations along the transition to the economy’s balanced growth path.

We live in an age of rapid change. The advance of science and technology, throughout history, has culminated in periods of transition when social values have had to adapt to a changed environment. Such times have proved fertile ground for the expansion of the imagination. Utopian literature offers a vast archive of information concerning the relationship between scientific and technological progress and social change. Alterations in the most basic machinery of society inspired utopian authors to write of distant and future worlds which had achieved a state of harmony and plenty. The dilemmas which writers faced were particular to their era, but there also emerged certain universal themes and questions: What is the best organisation of society? What tools would be adequate to the task? What does it mean to be human? The dividing line on these issues revolves around two opposed beliefs. Some perceived the power inherent in technology to effect the greatest improvement in the human condition. Others were convinced that the organisation of the social order must come first so as to create an environment sympathetic to perceived human needs. There are, necessarily, contradictions in such a division. They can be seen plainly in More's Utopia itself. More wanted to see new science and technique developed. But he also condemned the social consequences which inevitably flowed from the process of discovery. These consequences led More to create a utopia based on social reorganisation. In the main, the utopias of Francis Bacon, Edward Bellamy and the later H. G. Wells accepted science, while the work of William Morris, Aldous Huxley and Kurt Vonnegut rejected science in preference for a different social order. More's Utopia and Bacon's New Atlantis were written at a time when feudal, agriciTfural society wasbeeing transformed by new discoveries and techniques. In a later age, Bellamy's Looking Backward and Morris's News From Nowhere offer contrary responses to society at the height of the Industrial evolution. These four authors serve as a prelude to the main area of the thesis which centres on the twentieth century. Wells, though his first novel appeared in 1895, produced the vast bulk of his work in the current century. Huxley acts as an appropriate balance to Wells and also exemplifies the shift from utopia to dystopia. The last section of the thesis deals with the work of Kurt Vonnegut and includes an interview with that author. The twentieth century has seen the proliferation of dystopias, portraits of the disastrous consequences of the headlong pursuit of science and technology, unallied to human values. Huxley and Vonnegut crystallised the fears of a modern generation: that we create a soulless, mechanised, urban nightmare. The contemporary fascination with science in literature is merely an extension of a process with a long tradition and underlying theme. The advance of science and technology created the physical and intellectual environment for utopian authors which determined the form and content of their visions.

The hypothesis in this paper is that the existence of retail markets may not necessarily be determined by spatial factors and increasing return in transportation (or increasing returns in retailing), but can be explained by the rational behaviour of firms operating in a stochastic environment. It is shown that demand uncertainty can serve as an independent source of retail trade. Consequently, the ability of firms to process information and predict demand (i.e., to decrease demand uncertainty) may affect the characteristics of retail markets. The results indicate that risk-averse firms always devote resources to demand forecasting; producers are better off trading with retailers than with final consumers; and the volume of output supplied through retail markets is greater than it would be if producers traded directly with consumers (thus benefiting social welfare). Furthermore, the paper shows that technological progress in data-processing, which allows for cheaper and better predictions of market demand, increases the number of firms operationg in retail markets. (authors' abstract) / Series: Discussion Papers of the Institute for Economic Geography and GIScience

Cette thèse s’intéresse à l'impact des « patent pools » sur l’innovation cumulative. Nous analysons huit patents pools modernes développés dans les secteurs des technologies de l’information et de la communication. Un patent pool est un regroupement de propriétaires de brevets qui permet la négociation d’une seule licence pour plusieurs brevets essentiels à l’implémentation des normes techniques. Les patent pools font l’objet de nombreux travaux théoriques et empiriques. Ces travaux notent le risque collusif et monopolistique existant au sein de ces institutions. Cependant, la majorité des travaux se concentre principalement sur les facteurs qui motivent une entreprise à se joindre à un patent pool et non pas l’évolution des normes techniques au fil du temps. / This thesis investigates the impact of patent pools for technical standards on the direction of cumulative innovation. It examines eight modern patents pools in the information and communication technology sector and measures the effect of pool formation and pool extension on rates of follow-on innovation in the direction of pool technology. Patent pools are the subject of much theoretical and empirical work. The aim of this thesis is to fill a gap in current literature that focuses on the motivations of firms to join a patent pool. This thesis contributes to the literature by extending analyses to the introduction of patents to patent pools over time. It consists of three empirical studies. Patent pools as institutions possess mechanisms that encourage and discourage innovation. The formation of a patent pool and its extension as a result of the addition of patents to the patent pool after its launch may alter the incentives to innovate of outsider firms. This, in turn, may have important impacts on competition and society. Finally, this thesis also analyzes the evolution of an industry that is particularly linked to technology in patents pools—the film industry. Digitization has transformed movie distribution and technological disruption has altered the supply and demand dimensions of this market. The main findings of these three studies are presented at the beginning of each chapter.

No / This paper studies the impact of foreign direct investment (FDI) on total factor productivity (TFP) for a cross sectional sample of Chinese industrial sectors. The possible determinants of TFP are sought with special focus on FDI. An endogeneity test is performed in order to avoid inconsistent results. Evidence indicates that foreign presence, the level of R&D and the firm size are the most important factors enhancing TFP in Chinese industries. The findings from this study support the argument that attracting FDI is an effective way of introducing advanced technology to host countries.

The paper examines the application of the concept of economic efficiency to organizational issues of collective information processing in decision making. Information processing is modeled in the framework of the dynamic parallel-processing model of associative computation with an endogenous set-up cost of the processors. The model is extended to include the specific features of collective information processing in the team of decision makers which could cause an error in data analysis. In such a model, the conditions for efficient organization of information processing are defined and the architecture of the efficient structures is considered. We show that specific features of collective decision making procedures require a broader framework for judging organizational efficiency than has traditionally been adopted. In particular, and contrary to the results presented in economic literature, we show that in human data processing (unlike in computer systems), there is no unique architecture for efficient information processing structures, but a number of various efficient forms can be observed. The results indicate that technological progress resulting in faster data processing (ceteris paribus) will lead to more regular information processing structures. However, if the relative cost of the delay in data analysis increases significantly, less regular structures could be efficient. (authors' abstract) / Series: Discussion Papers of the Institute for Economic Geography and GIScience