The Origins of the Economics of Innovation: John Rae (1824)
CocciaLab Working Paper 2017 – No. 17
27 Pages Posted: 13 May 2017
Date Written: May 11, 2017
John Rae has recently been rediscovered as a precursor of the endogenous growth theory. This study argues that Rae needs to be rediscovered a second time for his original contribution to clarify the role of the innovation and technical change within the economic systems. The aim of this paper is to suggest that the origins of the Economics of innovation go back to many years before Schumpeter’s theory (1911), with the original study by John Rae in 1834.
The Scottish philosopher with his book Statement of Some New Principles on the Subject of Political Economy, issued in 1834, put forward the basis of the Economics of innovation individuating the nature, causes and effects of the technological progress on economic growth of nations. Rae also discusses the evolution and role of vital technologies for the wealth and employment of nations in Europe and America. Overall, then, this study here suggests the importance of Rae’s work for the origin of the Economics of innovation and a definition of this discipline, which embodied the main concepts appeared during the history of the economic thought. The conclusions are tentative, but it is the first step to detect the purpose of this important research field that explains one of the causes of economic growth and progress of nations over time.
Keywords: Invention, Innovation, History of Technology, Economic Growth, New Technology, Technological Change, Economics of Innovation
JEL Classification: B11, B12, B31, B40, O30
Suggested Citation: Suggested Citation