A long-term comparative analysis of the direction and congruence of technological change

Technological congruence identifies the coherence between the direction of technological change and input costs in an economy and measures its effects on Total Factor Productivity (TFP). The search for technological congruence is constrained by the systemic characteristics of the countries where it takes place with special attention to the types of industrial relations and the role of the labor force in the accumulation of technological knowledge. Constrained technological congruence enables to interpret the heterogeneous long-term evidence of five advanced countries. The analysis confirms that the direction of technological change and its effects are heterogeneous across countries and time and reflect the specific conditions of their internal and external labor markets and of their knowledge generation processes.