TECHNOLOGICAL R EGIMES A ND S CHUMPETERIAN PATTERNS O F I NNOVATION

This paper proposes that the specific pattern of innovative activities in an industry can be explained as the outcome of different technological (learning) regimes. A technological regime is defined by the particular combination of technological opportunities, appropriability of innovations, cumulativeness of technical advances and properties of the knowledge base. Building upon the distinction between Schumpeter Mark I and Schumpeter Mark II industries, this paper provides empirical estimates of the relationships between indicators of the Schumpeterian patterns of innovation (concentration of innovative activities, stability in the hierarchy of innovators and importance of new innovators) and indicators of the variables defining technological regimes. This paper proposes that the specific pattern of innovative activities in an industry can be explained as the outcome of different technological (learning) regimes. Building on the Schumpeterian tradition, this paper starts from the recognition that there are two main patterns of innovation in industries. The first one is a creative destruction pattern where innovations are introduced by firms that did not innovate before: it is called ‘widening’. The second one is a creative accumulation pattern where innovations are introduced by firms that innovated before: it is called ‘deepening’. Whether an industry is characterised by the first or the second pattern is identified by a variable: a Schumpeterian pattern of innovation of the Mark I or Mark II type. A Schumpeter Mark II pattern (deepening) is associated positively to the concentration ratio of the top four patenting firms and to the stability of the hierarchy of innovators, and negatively to the share of patent applications by firms applying for the first time in a certain period. A Schumpeter Mark I pattern (widening) is the opposite. Then the specific pattern of innovation is explained by technological opportunities, appropriability conditions, cumulativeness of knowledge and the relevant knowledge base in an industry. The paper shows that less technological opportunities, better appropriability conditions, more cumulative knowledge and a knowledge base closer to basic science work in the direction of a deepening (or Schumpeter Mark II) pattern. The opposite holds for a widening (or Schumpeter Mark I) pattern. The paper is organised in the following way. Section 1 briefly discusses the debate on technological change and patterns of innovation in industry, while Section 2 introduces the basic notion of technological regime. Section 3 discusses in an appreciative way the expected theoretical relationships between the variables defining technological regimes and the patterns of innovative activities. Section 4 illustrates the data used in the empirical analysis. In The Economic Journal, 110 (April ), 388‐410. # Royal Economic Society 2000. Published by Blackwell Publishers, 108 Cowley Road, Oxford OX4 1JF, UK and 350 Main Street, Malden, MA 02148, USA.