<p><em>Directed technical change</em> is the relatively recent name for what it was was previously called <em>Induced technical change</em>. </p>

<p>Informal discussion about the <strong>endogenous</strong> direction of technical change was first discussed (but not "microfounded") by <a href="https://en.wikipedia.org/wiki/The_Theory_of_Wages" rel="nofollow noreferrer">Hicks (1932)</a> and <a href="https://wwz.unibas.ch/fileadmin/wwz/redaktion/umwelt/Fellner_1961.pdf" rel="nofollow noreferrer">Fellner (1961)</a>. Yet, it was <a href="https://www.jstor.org/stable/2228295" rel="nofollow noreferrer">Kennedy (1964)</a> who first proposed a formal model about endogenous technical change (previous examples like <a href="https://faculty.georgetown.edu/mh5/class/econ489/Solow-Growth-Accounting.pdf" rel="nofollow noreferrer">Solow (1957)</a> assumed <strong>exogenous</strong> technical change).</p>

<p>The more recent denomination of <em>directed technical change</em> was proposed by Acemoglu (2002). This author has plenty of material about the topic:</p>

<ul>
<li><p>these very comprehensive <a href="https://economics.mit.edu/files/7402" rel="nofollow noreferrer">slides</a> (also <a href="https://economics.mit.edu/files/12249" rel="nofollow noreferrer">here</a>, and why not, see all the material he shares <a href="https://economics.mit.edu/faculty/acemoglu/courses" rel="nofollow noreferrer">here</a>).</p></li>
<li><p>The <a href="https://economics.mit.edu/files/4126" rel="nofollow noreferrer">2002 paper</a> on the subject</p></li>
<li><p>Chapter 15 of his <a href="http://press.princeton.edu/titles/8764.html" rel="nofollow noreferrer">book</a> on economic growth</p></li>
</ul>

<p>You can also see more about the historical literature on induced technological change <a href="https://wwz.unibas.ch/fileadmin/wwz/redaktion/umwelt/lecture_2_semi-endogenous_growth.pdf" rel="nofollow noreferrer">here</a> and <a href="http://onlinelibrary.wiley.com/doi/10.1111/meca.12141/abstract" rel="nofollow noreferrer">here</a>.</p>

CC BY-SA 3.0
2017-08-18T16:49:01.480Z
@london an interesting question though is why Acemoglu decided to change the name. He is clearly aware of the literature (see bottom of page 5 in his 2002 paper), and he uses the name "induced innovations".
luchonacho
CC BY-SA 3.0
2017-08-18T17:25:07.993Z
so he is using 'biased technical change' and 'directed technical change' to refer to induced technical change. Would it be fair to give credit to Acemoglu for renaming the theory and formalising it?
london
CC BY-SA 3.0
2017-08-20T08:24:35.890Z
Biased technical change is solely about the **nature/outcome** of the change, and has been around before the induced/directed literature. Directed technical change refers to the source/mechanism of the technical change in a given model. This is, you could have unbiased or biased technical change in both directed and undirected technical change models. They refer to two different, orthogonal dimensions of technical change. Reg your second point, the theory was formalised already. Acemoglu gave to it a new impulse, and made use of newer/better data to put it to the test, and to study new issues
luchonacho
CC BY-SA 3.0
2017-08-17T18:28:02.603Z
2017-08-17T18:48:25.670Z
2017-08-17T18:48:25.670Z
luchonacho
<p>I am trying to get a better grip on the literature on <em>directed technical change</em> and <em>induced technical change</em>. In other words, I am trying to understand if these concepts are the same and used interchangibly in the literature to refer to endogenous technical change.</p>

<p>Also, can anyone please point to a good review of the literature on this topic(s)? </p>

CC BY-SA 3.0
2017-08-17T17:56:27.447Z
Look at here 
https://scholar.google.fr/scholar?cites=12578183228865700583&as_sdt=2005&sciodt=0,5&hl=fr

these are the papers that cited the famous paper of Acemoglu (2002)
optimal control
<reference-request><economic-growth><endogenous-growth><directed-technical-change>
Induced technical change vs. directed technical change
london
# Induced technical change vs. directed technical change

(Asked by: username_0 on 2017-08-17)

I am trying to get a better grip on the literature on *directed technical change* and *induced technical change*. In other words, I am trying to understand if these concepts are the same and used interchangibly in the literature to refer to endogenous technical change.

Also, can anyone please point to a good review of the literature on this topic(s)?

**Tags:** reference-request, economic-growth, endogenous-growth, directed-technical-change
> **Comments:**
> **username_1**: Look at here  https://scholar.google.fr/scholar?cites=12578183228865700583&as_sdt=2005&sciodt=0,5&hl=fr  these are the papers that cited the famous paper of Acemoglu (2002)  

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## 1 answers

### Answer by username_2 on 2017-08-17. Score: 2 | Accepted answer

*Directed technical change* is the relatively recent name for what it was was previously called *Induced technical change*.

Informal discussion about the **endogenous** direction of technical change was first discussed (but not "microfounded") by [Hicks (1932)](https://en.wikipedia.org/wiki/The_Theory_of_Wages) and [Fellner (1961)](https://wwz.unibas.ch/fileadmin/wwz/redaktion/umwelt/Fellner_1961.pdf). Yet, it was [Kennedy (1964)](https://www.jstor.org/stable/2228295) who first proposed a formal model about endogenous technical change (previous examples like [Solow (1957)](https://faculty.georgetown.edu/mh5/class/econ489/Solow-Growth-Accounting.pdf) assumed **exogenous** technical change).

The more recent denomination of *directed technical change* was proposed by Acemoglu (2002). This author has plenty of material about the topic:

* these very comprehensive [slides](https://economics.mit.edu/files/7402) (also [here](https://economics.mit.edu/files/12249), and why not, see all the material he shares [here](https://economics.mit.edu/faculty/acemoglu/courses)).
* The [2002 paper](https://economics.mit.edu/files/4126) on the subject
* Chapter 15 of his [book](http://press.princeton.edu/titles/8764.html) on economic growth

You can also see more about the historical literature on induced technological change [here](https://wwz.unibas.ch/fileadmin/wwz/redaktion/umwelt/lecture_2_semi-endogenous_growth.pdf) and [here](http://onlinelibrary.wiley.com/doi/10.1111/meca.12141/abstract).

> **Comments:**
> **username_2**: @london an interesting question though is why Acemoglu decided to change the name. He is clearly aware of the literature (see bottom of page 5 in his 2002 paper), and he uses the name "induced innovations".  
> **username_0**: so he is using 'biased technical change' and 'directed technical change' to refer to induced technical change. Would it be fair to give credit to Acemoglu for renaming the theory and formalising it?  
> **username_2**: Biased technical change is solely about the **nature/outcome** of the change, and has been around before the induced/directed literature. Directed technical change refers to the source/mechanism of the technical change in a given model. This is, you could have unbiased or biased technical change in both directed and undirected technical change models. They refer to two different, orthogonal dimensions of technical change. Reg your second point, the theory was formalised already. Acemoglu gave to it a new impulse, and made use of newer/better data to put it to the test, and to study new issues  

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