The Role Of Technology In Economic Development Research Paper

The Role Of Technology In Economic Development - Research Paper Example People encounter improvements in their living through economic development occurring in a nation. The scope of this study is primarily limited to the economy of United States. However the existing literature and the different viewpoints offered by various researchers and authors related to technology and economic development have been included in this study. Economic development can be viewed from the institutionalism perspective which states that technology forms an important driving force for the economic development of a nation. However this has been argued by the ecological economists who do not consider technology being the only factor that can lead to development of an economy. Trade and technology are found to be positively correlated with each other and most of the nations using greater volume of technology are the most economically developed nations of the world. Hence technology plays a vital role in the sustainable growth and development of an economy. Technology has been defined by economists as knowledge or ideas that facilitate increased production of output from a given input. A greater amount of technology implies that the ability of producing output is enhanced using the same amount of input as was used earlier. Technology can be considered to be composed of various things. It can imply different types of engineering discoveries like the inventions of light bulb or airplane, basic knowledge, concepts related to services or production, etc. The importance of technology is evident because of the fact that inputs of regular quantities are associated with diminishing returns. Keeping other things constant, the utilization of more inputs leads to lesser amount of outputs that can be produced through each of the additional inputs. However, since similar concept is applicable to the overall economy, use of technology does not lead to diminishing returns. Hence it has been observed that technology has a significant role to play in the process of overco ming various limitations that are imposed through the phenomenon of diminishing returns to capital and labor. Prophecies of doom have been announced in various points of time in the historical past which was based on the concept that the scarcity of one of the inputs would result in the halt of economic growth. However technological advancements have disproven all of these prophecies so far. Technology has helped us to formulate ways through which we can produce more output from a given input and hence reduced the dangers that are imposed through the limitations of the availability of certain resources. The role of technology in the economic development of a nation can be viewed from different perspectives like the economical and social perspectives. Development is actually referred to the various improvements that occur in the lives of people living in a community. This study entails about the various roles played by technology towards the economic growth and development of a natio n. The scope of this study is mostly limited to the economy of United States. However it has been compared and contrasted with various other economies and from the global