Technology and economic

transformation
• Technology, in itself, is not deterministic of the
globalization of economic activity.
• Specific choices within the frontier of
technological possibilities are not the product
of technological change.
• Technology does not drive choice; choice drives
technology.
Processes of Technological Change: an
evolutionary perspective
• Technological change not only involves the
invention of new things, but also depends upon
the transformation of inventions into usable
innovations, and their subsequent adoption and
diffusion.
• Four types of technological change
– incremental innovations
– radical innovations
– changes of technology system
– changes in the techno-economic paradigm
 Processes of Technological Change: an
evolutionary perspective
• Technological revolutions and long waves

Figure 4.2 Kondratiev long waves

Source: based, in part, on Freeman and Louçã, 2001: Table II.1
Processes of Technological Change: an
evolutionary perspective
• Technological revolutions and long waves
• Each wave tends to be associated with particularly significant
technological changes
• When depression is reached a new sequence will be initiated
on the basis of key technologies and of new investment
opportunities
• Each successive K-wave also has a specific geography, as
technological leadership shifts over time
• Information and communications technologies: the digital world
• The fifth Kondratiev long wave is associated with information
and communications technology
• Digital technology is based upon the convergence of two
initially distinct technologies: communications technologies
(concerned with the transmission of information) and computer
technologies (concerned with the processing of information).
 Processes of Technological Change: an
evolutionary perspective
• Information and communications technologies: the digital world

Figure 4.5 Exponential increase in the capacity of microprocessors

Time–space shrinking technologies

• Before the invention of electric technology in the nineteenth

century, information had to be physically carried. Transportation
and communication were as “one”. Differently from digital world,
information could not be transmitted and processed simultaneously.

• Transportation technologies
– Commercial jet aircraft, and containerization: recent developments
– ‘Both the time and the relative cost of transporting materials,
products, and people have fallen dramatically as the result of
technological innovations in the transportation media’

• Communication technologies
– Satellites and optical fibre cables: most significant development
– The Internet
– Moving away from individual computer systems to networked systems
provided through the Internet (e.g. ‘cloud computing’)
– Smartphones
 Time–space shrinking technologies
• Digital divides
• Not all places are equally connected
• Investment in technologies go to where returns are highest

Figure 4.12 The uneven geography of Internet domain names

Source: based on data provided by Matthew Zook
Technological innovations in products,
production systems and organizational
forms
• Current trends
– information intensity
– enhanced flexibility of production
– diversity of production systems
– increased specialization
– standardization of operations
– flexibility and modularity in production processes
Virtual Reality
 Goal of virtual reality (VR):
 Create an environment in which users can interact
and participate as they do in the real world
 VR technology
 Uses computer-generated, three-dimensional
images to create the illusion of interaction in a
real-world environment
 VR terms:
 Simulation
 Interaction
 Immersion
 Telepresence
 Full-body immersion
 Networked communication
Virtual Reality Applications
 Military flight simulations
 Medicine for “bloodless” surgery
 Entertainment industry
 Will one day be used for user interfaces in information systems
 Current applications:
 Applications for the disabled
 Architectural design
 Education
 Flight simulation
 Videoconferencing
 Group support systems
 Obstacles in Using VR Systems
 Not enough fiber-optic cables are currently
available for a VR environment capable of re-
creating a conference
 Problems must be solved:
 Confusion between the VR environment and the real
environment
 Mobility and other problems with HMDs
 Sound representation
 Additional computing power
 Radio Frequency
Identification: An Overview
 Radio frequency identification (RFID) tag
 Small electronic device consisting of a small chip and an
antenna
 Provides a unique identification for the card or the object
carrying the tag
 Don’t have to be in contact with the scanner to be read
 Can be read from a distance of about 20 feet
 Two types of RFID tags:
 Passive : No battery, Best ones have about 10 years of battery
life
 Active: Usually more reliable than passive tags, Technical
problems and issues of privacy and security
Table 14.1 RFID Applications

Category Examples
Tracking and identification Railway cars and shipping containers, livestock and
pets, supply-chain management (tracking merchandise
from manufacturers to retailers to
customers), inventory control, retail checkout and POS
systems, recycling and waste disposal

Payment and stored-value systems Electronic toll systems, contactless credit cards (require
no swiping), subway and bus passes, casino tokens,
concert tickets

Access control Building access cards, ski-lift passes, car ignition

systems

Anticounterfeiting Casino tokens, high-denomination currency notes,

luxury goods, prescription drugs

Health care Tracking medical tools and patients (particularly

newborns and patients with Alzheimer’s), process
control, monitoring patient data
 Biometrics: A Second Look
 Current and future applications of biometrics:
 ATM, credit, and debit cards
 Network and computer login security
 Web page security
 Voting
 Employee time clocks
 Airport security and fast check-in
 Passports and highly secured government ID cards
 Sporting events
 Cell phones and smart cards
Trends in Networking
 Recent trends in networking technologies
 Many are already used in many
organizations
 Wireless technologies and grid computing
 Newer but attracting a lot of attention:
 WiMAX and cloud computing
Wi-Fi
 Wireless Fidelity (Wi-Fi)
 Broadband wireless technology
 Based on the 802.11a, 802.11b, 802.11g, and 802.11n standards
 Information can be transmitted over short distances
 In the form of radio waves
 Connect via:
 Computers, mobile phones and smart phones, MP3 players, PDAs, and game
consoles
 Wi-Fi hotspots
WiMAX
 Worldwide Interoperability for Microwave Access (WiMAX)
 Broadband wireless technology
 Based on the IEEE 802.16 standards
 Designed for wireless metropolitan area networks
 Theoretically has faster data transfer rates and a longer range than Wi-Fi
 Disadvantages:
 Interference from other wireless devices, high costs, and interruptions from
weather conditions
 Bluetooth
 Can be used to create a personal area network (PAN)
 Wireless technology for transferring data over short distances
 Specifications are developed and licensed by the Bluetooth Special
Interest Group
 Uses a radio technology called Frequency Hopping Spread
Spectrum (FHSS)
 Used to connect devices such as:
 Computers, global positioning systems (GPSs), mobile phones, laptops,
printers, and digital cameras
 No line-of-sight limitations
 Limited transfer rate
Grid Computing
 Connecting different computers to combine their processing power to
solve a particular problem
 “Node”
 Each participant in a grid
 Processing on overused nodes can be switched to idle servers and even
desktop systems
 Advantages:
 Improved reliability
 Parallel processing nature
 Scalability
 Cloud Computing
 Platform incorporating many recent technologies under one
platform, including:
 SaaS model, Web 2.0, grid computing, and utility computing
 Variety of resources can be provided to users over the Internet
 Example:
 Editing Word document on an iPhone
 Same advantages and disadvantages as distributed computing
 Services typically require a fee
 Some are free
 Google Apps
 Includes Gmail, Google Talk, and Google Docs,
 Provides commonly used applications accessed via a Web browser
Cloud Computing in Action

 Amazon.com
 Established a computing platform that companies can use,
regardless of their location
 Provides storage and processing power on demand
 Companies pay only for the resources they use
 Google Apps
 Introduced in February 2007
 Competing with Microsoft’s Office Suite
Nanotechnology

 Incorporates techniques that involve the structure and

composition of materials on a nanoscale
 Nanometer is one billionth of a meter (10-9)
 Current technology for making transistors and other
components might reach their miniaturization limits in
the next decade
 Some consumer goods incorporating nanotechnology are
already on the market
 Nanomaterials
Summary
 New trends:
 Software as a service
 Virtual reality
 RFID
 Networking
 Grid, utility, and cloud computing
 Nanotechnology