From Necessities to Imaginary Worlds: Structural Change, Product Quality and Economic Development

Pier Paolo Saviotti, INRA-GAEL, Université Pierre Mendès-France

The main objective of this paper is to compare the roles of output variety and of product quality in economic development. In particular, we wish to explain why product quality started increasing only a considerable time after the beginning of the industrial revolution and was preceded by an economic development driven almost exclusively by sectoral differentiation. Thus, we separate the period since the industrial revolution into two sub periods, which we call necessities and imaginary worlds. In the first period most people could afford only necessities while in the second one a growing percentage of the population of industrialized countries started to be able to afford goods and services which were not necessities, but what some authors have called higher goods services (Menger, 1950). In this paper we use the concept of trajectory and focus on three trajectories, increasing productive efficiency, increasing output variety, and increasing output quality which includes also product differentiation. Amongst the variables which we expect to have the greatest impact on output variety and on product quality we have selected wages, rates of population growth and education. A distinctive feature of our approach is that we take into account both demand and supply factors by studying the co-evolution of demand and innovation.

About the speaker
Pier Paolo Saviotti is Guest Professor, Eindhoven Centre for Innovation Studies (ECIS), School of Innovation Sciences, Eindhoven University of Technology, Guest Professor, Department of Economics, University of Hohenheim, Germany , Associate Research Fellow, INRA GAEL, Grenoble, France and Associate Research Fellow, GREDEG CNRS, Sophia Antipolis, France. He studied Chemistry at the Universities of Perugia (1968) and at McGill University in Montreal (1975) where he obtained a PhD in Chemistry. Between these two appointments he had been working as a researcher in the laboratories of Snam Progetti (ENI) (1969-1970). Following his PhD he taught chemistry in the University of Zulia, Maracaibo , Venezuela, between 1976 and 1978. In 1980 he obtained an MSc in « Structure and Organization of Science and Technology » from the University of Manchester, where he then worked as a Lecturer from 1981 to 1994. After 1994 he worked as Director of Research at the INRA unit in Grenoble. Between 1996 and 2000 he was director of the SERD team and of the INRA unit. Between 2001 and 2009 he was also working at half time in GREDEG CNRS, Sophia Antipolis. In 2006 he was the chairman of the committee to award the Schumpeter Prize of the International Schumpeter Society. Between July 2008 and July 2012 he has been vice-president of the International Schumpeter Society. He is a member of the Lisbon Civic Forum. His research interests include the economics of innovation, the economics of knowledge, evolutionary theories of economic and technological development.

Venue: Conference Room

Date: 31 January 2013

Time: 12:30 - 13:30