Government Structure and the Political Economy of Technological Innovation

41 Pages Posted: 31 Aug 2007

See all articles by Mark Zachary Taylor

Mark Zachary Taylor

Georgia Institute of Technology - The Sam Nunn School of International Affairs

Date Written: November 2006

Abstract

Are decentralized states better at technological innovation than centralized states? Economic and political theorists, from Hayek to Mokyr, suggest that government decentralization offer advantages for innovators. Decentralized governments are widely seen as agile, competitive, and well structured to adapt to innovation's gale of creative destruction. Meanwhile, centralized states, even when democratic, are subject to capture by status-quo interest groups which use their influence to promote policies which ultimately restrict long-run technological change. Therefore decentralized government is increasingly perceived as a necessary institutional foundation for fostering long-run technological innovation. I test this theory using data on international patent activity, scientific publications, and high-technology exports.

Keywords: Innovation, Technology, Technological, Government, Decentralization, Federalism

JEL Classification: O3, O11, P26

Suggested Citation

Taylor, Mark Zachary, Government Structure and the Political Economy of Technological Innovation (November 2006). Available at SSRN: https://ssrn.com/abstract=1008588 or http://dx.doi.org/10.2139/ssrn.1008588

Mark Zachary Taylor (Contact Author)

Georgia Institute of Technology - The Sam Nunn School of International Affairs ( email )

781 Marietta Street NW
Atlanta, GA 30332-1610
United States

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