More Machines, Better Machines...Or Better Workers?

49 Pages Posted: 11 Nov 2008 Last revised: 17 Jan 2015

See all articles by James E. Bessen

James E. Bessen

Technology & Policy Research Initiative, BU School of Law

Date Written: June 1, 2009

Abstract

How much of the rapid growth in labor productivity in nineteenth century cotton weaving arose from capital-labor substitution and how much from technical change? Using an engineering production function and detailed information on inventions, I find that factor substitution accounts for little growth. However, much of the growth and most of the apparent labor-saving bias arose not from inventions, but from improved labor quality — better workers spent less time monitoring the looms. The inventions themselves were almost technically neutral because innovations in general purpose technologies were capital-saving. Labor quality played a critical role in the persistent association between economic growth and capital deepening in this important sector.

Keywords: technical change, productivity growth, technical bias, innovation, US manufacturing history, general purpose technologies

JEL Classification: O33, O47, N61, N11

Suggested Citation

Bessen, James E., More Machines, Better Machines...Or Better Workers? (June 1, 2009). Available at SSRN: https://ssrn.com/abstract=1299577 or http://dx.doi.org/10.2139/ssrn.1299577

James E. Bessen (Contact Author)

Technology & Policy Research Initiative, BU School of Law ( email )

765 Commonwealth Avenue
Boston, MA 02215
United States

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