Abstract
The accumulation of new technological capabilities is of high empirical relevance, both for the development of countries and the business success of firms. This paper aims to delineate strategies for the consideration of processes of capability accumulation in comprehensive macroeconomic models. It comprises a methodological discussion about the preconditions for macroeconomic models to consider insights from the applied business literature, as well as an extensive review of the literature specialized on capability accumulation on the firm and aggregated level. In doing so, it summarizes evidence on various determinants and mechanisms of capability accumulation and aligns them with the current representation of capability accumulation in macroeconomic models. Based on these results, it offers some suggestions on how macroeconomists may integrate these determinants derived from the specialized literature into their models.
Highlights
Numerous empirical investigations stress that the accumulation of technological capabilities is essential for the growth and development of countries and regions, as well as for the business success of firms
That scholars from various disciplines agree on the relevance of capabilities, and have produced various empirical insights on the factors driving capability accumulation (CA, hereafter), many of these insights from the applied literature specialized on CA have not made their way into macroecononmic models
This positive effect has been documented empirically, it has been considered in both specialized and macroeconomic models various times
Summary
Numerous empirical investigations stress that the accumulation of technological capabilities is essential for the growth and development of countries and regions, as well as for the business success of firms. That scholars from various disciplines agree on the relevance of capabilities, and have produced various empirical insights on the factors driving capability accumulation (CA, hereafter), many of these insights from the applied literature specialized on CA have not made their way into macroecononmic models This leaves macroeconomic researchers with both a challenge and an opportunity: on one hand, there are empirical insights available that can inform the construction of new macroeconomic models that promise a deeper understanding of economic growth and development. On the other hand, transferring the fine-grained empirical results on CA into a comprehensive macroeconomic framework is troublesome and often conflicts with the task of keeping the overall complexity of these models manageable This challenge is aggravated by the fact that, in economics, there is much less concrete work on which mechanisms impact on CA under particular circumstances. The situation is different in management, organization and innovation studies, where the mechanisms of CA have been at center stage for a long time — yielding
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