(Are) Institutions More Important than Innovation?
AbstractThe aim of this paper is to shed more light on the effects of technological innovation on economic progress from the institutionalist perspective. Based on historical data on economic growth and technological changes in the United States, we question the assumption of mainstream economics that innovation, performed by profit-making enterprises, is a key source of productivity growth. The difference between the golden age and the period since then suggests that economic progress is primarily determined by a successfully functioning institutional structure and progressive institutional changes.
Keywords: Economic progress, Technological innovation, Progressive institutional changes, Old institutionalism
JEL: B52, O33, O43.