Technological Change, Learning-by-Doing and the Structure of Production in the U.S. Machine Tool Industry

As delineated in Chapter 5, the U.S. manufacturing sector has been losing international and domestic market share—first in the “mature” industries and more recently in the high technology industries. Among the “mature” industries, machine tools first experienced declining international competitiveness in the 1960s, and has been steadily losing market share to international competitors, not only in world trade but in the domestic market.1 Today, the American machine tool industry is believed to be significantly behind Japanese and West German industries in the organization and technology used in the production process, as are many other manufacturing industries in U.S.2