Definitions and Basics

Technology, at


  • 1. the branch of knowledge that deals with the creation and use of technical means and their interrelation with life, society, and the environment, drawing upon such subjects as industrial arts, engineering, applied science, and pure science.
  • 2. the terminology of an art, science, etc.; technical nomenclature.
  • 3. a technological process, invention, method, or the like.
  • 4. the sum of the ways in which social groups provide themselves with the material objects of their civilization.

Industrial Revolution and the Standard of Living, from the Concise Encyclopedia of Economics

Between 1760 and 1860, technological progress, education, and an increasing capital stock transformed England into the workshop of the world. The industrial revolution, as the transformation came to be called, caused a sustained rise in real income per person in England and, as its effects spread, the rest of the Western world. Historians agree that the industrial revolution was one of the most important events in history, marking the rapid transition to the modern age, but they disagree vehemently about various aspects of the event. Of all the disagreements, the oldest one is over how the industrial revolution affected ordinary people, usually called the working classes. One group, the pessimists, argues that the living standards of ordinary people fell. Another group, the optimists, believes that living standards rose….

Innovation, from the Concise Encyclopedia of Economics

Innovation can turn new concepts into realities, creating wealth and power. For example, someone who discovers a cure for a disease has the power to withhold it, give it away, or sell it to others. Innovations can also disrupt the status quo, as when the invention of the automobile eliminated the need for horse-powered transportation….

Investment, from the Concise Encyclopedia of Economics

Investment is one of the most important variables in economics. On its back, humans have ridden from caves to skyscrapers. Its surges and collapses are still a primary cause of recessions….

In the News and Examples

Hal Varian on Technology, podcast on EconTalk

Hal Varian, Google’s Chief Economist and University of California at Berkeley professor, talks with Russ Roberts about Google, the role of technology in our everyday lives, the unintended paths of innovation, and the value of economics.

Kevin Kelly on the Future of the Web and Everything Else, podcast on EconTalk

Author Kevin Kelly talks about the role of technology in our lives, the future of the web, how to time travel, the wisdom of the hive, the economics of reputation, the convergence of the biological and the mechanical, and his impact on the movies The Matrix and Minority Report.

Consuming Spam Mail, by Declan McCullagh on Econlib

Paper junk mail has to have postage…. Not so with email…. From an economic perspective, spam is just another form of pollution, an activity that imposes costs on people without their permission….

Internet, from the Concise Encyclopedia of Economics

“The Internet changes everything”–or so we were told at the height of the Internet craze. According to a prominent Wall Street Journal article titled “Goodbye Supply and Demand,” one of the changes it was claimed to have brought about was a transformation of the basic economic forces at work in the economy….

Telecommunications, from the Concise Encyclopedia of Economics

Information and communications technology plays an increasingly important role in the wealth of nations. Adam Smith’s theory of economic growth emphasized the “division of labor” (i.e., productive specialization), and he argued that growth through the division of labor was limited by “the extent of the market.” Thus, he favored extension of markets….

Research and Development, from the Concise Encyclopedia of Economics

Research and development (R&D) is the creation of knowledge to be used in products or processes….

A Little History: Primary Sources and References

Railways, from Lalor’s Cyclopedia of Political Science

RAILWAYS, History and Political Economy of. Of all the factors that have contributed, during this century, to the growth of wealth, to the increase of material comfort, and to the diffusion of information and knowledge, the railway plays the most prominent part. It has widened the field for the division of employments; it has cheapened production; it has promoted exchange, and has facilitated intercommunication. In its aggregate it represents a larger investment of capital than any other branch of human activity; and the service that it renders and has rendered to society is, both from industrial and commercial points of view, greater than is rendered by any other single service to which men devote their activities….

Canals, from Lalor’s Cyclopedia of Political Science

Historical Sketch of Canals. Ancient Canals. The comparative cheapness and facility with which goods may be conveyed by sea or by means of navigable rivers seem to have suggested, at a very early period, the formation of canals. The best authenticated accounts of ancient Egypt represent that country as intersected by canals conveying the waters of the Nile to the more distant parts of the country, partly for the purpose of irrigation and partly for that of internal navigation….

Advanced Resources

Change and Progress with Uncertainty Absent, by Frank Knight. Part II, Chapter 5 from Risk, Uncertainty, and Profit

We turn now to the third grand division of theoretical economics, the study of the use of resources in the increase of resources for the making of goods and in the refinement of wants alongside of and alternative to their direct use in making goods for consumption….

Related Topics

Productive Resources