Innovation and transformation in the Swedish manufacturing sector, 1970-2007

This doctoral thesis investigates changes in the volume and character of Swedish manufacturing sector innovation output between 1970 and 2007, a time span composed of both extended periods of relative prosperity and decline. More specifically, it examines whether changes in the number of innovations, the character of the innovating firms, and the distribution of innovations across industries are generally associated with any such period. Significant differences in received accounts of structural transformation in the Swedish manufacturing sector motivate the study. A newly compiled database containing observations of nearly 4000 innovations is explored. It is found that innovation output is at its greatest during the economically stagnant period running from 1975 and until the first years of the 19 80s. Furthermore, innovations produced in this period are more novel than those of any other period. Innovation output observed in the relatively prosperous period 1994-2007 is meager and generally less novel. There is a marked increase in small firm innovation; from the early 1980s onwards, small firms are the most important source of innovation. The increase cuts through the entire period and stands in contrast with the economically important role traditionally considered to be played by large firms in the Swedish economy. Innovation output is found to shift from being primarily achieved in the capital goods sector to being subsequently developed in fields such as instruments, telecom products, and software. With regard to the revolutionary growth of microelectronics characterizing the period, the Swedish manufacturing sector is found to be competent in implementing such technology and to be primarily a receiver rather than a supplier of microelectronic components