Technological change in Australian manufacturing

Abstract

In the modern era, the extent and character of technical change features prominently in discussions of productivity growth and movements in the competitiveness of manufacturing. While technical change is pervasive in modern manufacturing, it occurs unevenly. In this study, technical change is estimated by fitting dual cost functions for each of 38 sectors of Australian manufacturing over the 32-year period, 1968/69 to 1999/2000. The estimates show that technical change is heavily labour saving in all industries, but that the rate of change and the degree of bias towards saving labour, rather than capital or material, varies substantially across industries.