Mapping the Technological Frontier

Abstract

Are there technologies that make firms that produce them and places where they are created thrive? What are the features that make these technologies impactful? This article seeks to understand where is that the value of technologies reside, to understand which are the features that make them virtuous and impactful. Using patent data, it proposes a way of identifying impactful technologies based on three distinctive characteristics, the rate at which a technology improves, the variety of other type of technologies that complement with it, and the pervasiveness of its use. These measures are then used to draw a technological frontier. It is shown that firms and economic sectors with a higher share (or number) of these frontier technologies are related to higher operating revenues, while countries with a higher share (or number) tend to have higher long-term growth rates. To prove the latter a new database was collected, which geo-locates patents granted to foreigners by the United States patent office from 1836 to 1975.