Technological change and input-output analysis: An appraisal

There is an extensive literature on technological change (TC) pertaining to input-output (I-O) analysis, that offers the potential to significantly extend the range of applications of this valuable tool. This paper classifies and analyzes the major types of TC. It summarizes some established methods for estimating TC, expands on methods not well developed, and shows how some methods not typically identified with I-O are useful. In addition, the methods are critically evaluated and their appropriateness to various subcategories of TC assessed. Two major conclusions are drawn. First, that input-output does not deserve much of the criticism it receives for being a rigid tool of analysis, insensitive to price changes, policy regulations and innovation. Second, given the availability of numerous approaches to incorporating TC into I-O models, researchers no longer have a legitimate excuse for assuming away TC or using crude modification methods.