Review of Industrial Organization 16: 319–321, 2000.
Paths of Innovation: Technological Change in 20th Century America.DavidMow-
ery and Nathan Rosenberg. Cambridge: Cambridge University Press, 1998, 214
pages (including index), $27.95.
Paths of Innovation: Technological Change in 20th Century America,byDavid
Mowery and Nathan Rosenberg, is a slender volume that is generally well-
constructed and well-reasoned. For those not yet exposed to the rich arena of
research on innovation and growth, this book might be a suitable and productive
Mowery and Rosenberg begin by noting that the inventive process in the United
States has become powerfully institutionalized. The forces that constitute the in-
stitution, and the context in which these forces emerged, are a central focus of
this volume. According to the authors, the institutionalization of innovation has
contributed mightily to economic growth in the United States in the 20th century.
The authors pose a thoughtful twist on the standard perspective of the process
of innovation and growth. In the typical description, we start with a scientiﬁc
breakthrough that is followed by a period of intense innovation during which time
improvements are made on the initial invention. In essence, we have a process
whereby new technologies lead to new products and subsequent high rates of
growth. The authors augment this view by observing that the adoption of new
technologies by mature industries, what they refer to as intersectoral ﬂows of
technology (or spillover effects), provide signiﬁcant sources of growth as well.
In support of this proposition, three discrete clusters of innovation are explored:
internal combustion engines, chemicals, and electricity/electronics. In each of these
cases, the authors detail how innovation and growth in the industry stimulated in-
novation and growth in a variety of other, oftentimes unrelated, industries. Each of
the three clusters of innovation share several common characteristics. First, they are
each highly research intensive. Second, each beneﬁted from the institutionalization
of the process of research and development. Finally, they are heavily inﬂuenced by
geography and resource endowment.
According to Mowery and Rosenberg, the institutionalization of the process of
research and development has three primary contributing sources: private industry,
government, and academia. In the case of private industry, the authors note that