How cumulative is technological knowledge?

TL;DR

This paper develops an analytical and empirical framework to understand how technological knowledge builds cumulatively, revealing that cumulativeness generally grows with the knowledge base but varies across technologies and over time.

Contribution

It introduces a formal model linking cumulativeness to knowledge base size and empirically tests this across multiple technologies using patent data.

Findings

Cumulativeness increases proportionally with knowledge base size.

The rate of cumulativeness growth varies significantly across technologies.

In rapidly growing technologies, cumulativeness increases more slowly over time.

Abstract

Technological cumulativeness is considered one of the main mechanisms for technological progress, yet its exact meaning and dynamics often remain unclear. To develop a better understanding of this mechanism we approach a technology as a body of knowledge consisting of interlinked inventions. Technological cumulativeness can then be understood as the extent to which inventions build on other inventions within that same body of knowledge. The cumulativeness of a technology is therefore characterized by the structure of its knowledge base, which is different from, but closely related to, the size of its knowledge base. We analytically derive equations describing the relation between the cumulativeness and the size of the knowledge base. In addition, we empirically test our ideas for a number of selected technologies, using patent data. Our results suggest that cumulativeness increases proportionally with the size of the knowledge base, at a rate which varies considerably across technologies. At the same time we find that across technologies, this rate is inversely related to the rate of invention over time. This suggests that the cumulativeness increases relatively slow in rapidly growing technologies. In sum, the presented approach allows for an in-depth, systematic analysis of cumulativeness variations across technologies and the knowledge dynamics underlying technology development.