Digital Nation: New Zealand From a tech sector to digital nation

Abstract

Changes in technology are a crucial source of economic growth. Long-run per capita growth is driven by technical change rather than, for example, investment or employment. While investment and employment are the basic ingredients of economic activity, the only way to raise material living standards over the long term is through technological change. On one view, growth is an evolutionary process of creative destruction, with waves of innovation periodically disrupting and restructuring markets.2 New technologies such as steam power, electricity, vehicles, ICT and biotechnology spawn clusters of innovations, leading to investment booms and cycles of growth.