Question

How does the improvement and progress of technology affect concentration in an industry? Please give an explanation.

Answer 1

Technological transition is the most significant factor deciding the pace of economic development. This has an important role to play than the development of capital. This is the technological transition that can lead to a continuous increase in production per head of population. This is also the primary engine of economic growth. Technological development or advancement refers to the discovery of new and improved methods of production of products. Often technical developments contribute to an increase in the available supply of natural resources.

But more importantly, technological progress results in an increase in the productivity of labor, capital and other resources. The productivity of the combined inputs of all factors is called the overall productivity factor. Therefore, technological advancement implies an improvement in the overall productivity of the factor. As a result of technical changes, it is possible to achieve more production with the same resources or the same quantity of product with fewer resources.

Technological transition is contributing to an rise in production per capita. Therefore, technological change, or more precisely technological progress, is a change in the process of production which results in an increase in output per unit of labor. Technological transition creates a shift in the production process that incorporates all recognized techniques. Technological change must be differentiated from technological change. Although technological progress implies the progression of technology resulting from improved methods of production, technical change refers to the use of a new but already existing method of production.

The productivity of workers depends on the quantity and efficiency of the capital instruments in which they operate. To order to maximize productivity, the methods of production must be technologically productive and superior. The technical options available to the economy decide the mix of inputs of output. Various technologies can produce a product. The quantity and quality of money, skills and other factors needed for production depend directly on the efficiency of the production technique used. Management and operational skills must always be in line with the technical requirements of production.Thus, technology in the present stage of economic development is an indispensable factor of production.