Technological specialization in industrial countries: Patterns and dynamics

We employ a distribution dynamics approach to examine the empirical dynamics of technological specialization in industrial countries. Using patent data, distributions of a specialization index and Markov stochastic kernels are estimated non-parametrically for each country. Three are the main findings. There are strong country size effects: economically “large” countries spread their innovation activities across a wider range of technologies and their specialization level in a field displays lower probability to move around its initial level. Mobility is nevertheless high. Mobility is also asymmetric: it appears mostly difficult for a country to improve the specialization level in very disadvantaged technologies, while high comparative advantages in technologies show a fairly general tendency to revert towards lower specialization levels. These findings cast doubt on the theory of technological accumulation and path-dependence, hence on its implication of persistence in national patterns of industrial specialization and on the effectiveness of targeted industrial and technology policies