Technology in economics - function, process or recipe?

This essay reflects on the ”-ology of technology”, pace Brian Arthur (2009), as conveyed in theformal (i.e. mathematical) treatment of technology and innovation in economic theory. In thedecades from the 1970s economists of the evolutionary strand have levied criticism on the way inwhich technology is handled in mainstream economics. Some of this criticism has concerned theassumptions made in particular mathematical models, while other arguments have been mademore strongly in favor of understanding technology through appreciative theorizing (Nelson andWinter, 1982). One is lead to ask: Can mathematical models do justice to the complexity oftechnology and technological change?While the emergence of endogenous growth theory (Romer, 1990; Aghion et al, 1998) has donemuch to develop notions of technology and innovation, there are still stark differences betweenapproaches to technology in economics. This paper examines to what extent and how recentcontributions in economics of complexity and evolutionary economics reflect differing ontologicalviews on technology from the canonical treatment in mainstream economics (Verspagen, 2005;Castellacci, 2007). Moreover, the study identifies key areas where formal analysis of the respectiveapproaches runs into problems.The essay focuses on the original arguments of e.g. Philip Wicksteed, Knut Wicksell and PaulSamuelson, in order to contrast their view of the production function with critical views suchas those emerging in the capital controversy Robinson (1953) and Nicolas Georgescu-Roegen’s(1971) formalization of production (inspired by Alfred North Whitehead’s process ontology).Recent formalizations of endogenous growth (Aghion et al, 1998) and GPTs (Bresnahan andTrajtenberg, 1995; Helpman, 1998; Lipsey et al, 2005) are also compared with frameworks basedon evolutionary biology, such as the frameworks of Nelson and Winter (1982), Saviotti & Metcalfe(1983), Dosi and Nelson (2013) and frameworks based on Stuart Kauffman’s (1993; 2000)NK-model. The essay ends with a reflection on Verspagen’s (2005) assessment of the state ofeconomics of innovation as two disparate but possibly converging viewpoints: the evolutionaryand endogenous growth view.