GPTs and growth: evidence on the technological adoption of electrical and electronic technologies in the 1920s

Abstract

The pervasive diffusion of electricity-related technologies at the beginning of the twentieth century has been studied extensively to understand the transformative potential of general purpose technologies (GPTs). Most of what we know, however, has been investigated in relation to the diffusion of their use. This article provides evidence on the county-level economic impact of the technological adoption of electrical and electronic (E&E) technologies in the 1920s in the United States (US). It focuses on measuring the impact of a GPT on technological adopters, i.e., those who are able to develop, transform, and complement it. It is shown that places with patenting activity in E&E technologies grew faster and paid higher wages than others between 1920 and 1930. This analysis required constructing a novel database identifying detailed geographical information for historical patent documents in the US since 1836, as well as developing a text-mining algorithm to identify E&E patents based on patent descriptions.