Technological profiles, upgrading and the dynamics of growth: Country-level patterns and trajectories across distinct stages of development

Abstract

We investigate the dynamic and qualitative nature of technological change in 96 countries between 1980 and 2021 from a structuralist technology upgrading perspective. First, drawing from patent data, we map the dynamics of technological knowledge by exploring the growth rates and significance of technology clusters. Second, we explore whether there is a relationship between specific technology clusters and economic growth. Third, we examine whether countries at different levels of development share similar or heterogeneous technology upgrading profiles and how patterns of technology upgrading have changed over time. We use a long-term, technology-level, cross-country patent dataset, and to address the issues identified we apply two complementary analytical methods: Generalized Method of Moments (GMM) panel data analysis and Fuzzy Set Qualitative Comparative Analysis (fs/QCA). We find a significant association between growth dynamics and country-level specific technology clusters that is driven by the ongoing ICT-based technological revolution and enabling nanotechnology, biotechnology and automation tools. Heterogenous trajectories in technological profiles allowed us to distinguish between more productive and less productive technology upgrading profiles at different income levels. Our results suggest that innovation policy should go beyond mission oriented policies focused solely on newly emerging technologies. Instead, it should develop policy mixes conceived as portfolios of missions focused on technology clusters with disparate objectives, requirements and institutional setups.