INTRODUCTION

As we reach the end of our explorations, it is instructive to look back at the assessment of formal modeling that Alfred Marshall offered many years ago:

We have been concerned in this book with grasping the decidedly complex real-life problems of innovation and industrial evolution. We have sought to capture in our dynamic models at least some of those “manifold influences of the element of time” of which Marshall spoke – though, of course, we do not make much progress on the full list. In choosing the “influences” to emphasize, we have tried in particular to bring to the fore the mechanisms that shape outcomes in ways that, while highlighted in many appreciative accounts of technological and industrial dynamics, are quite often ignored in highly stylized, static models. These are mechanisms that, first of all, take some time to operate. They also tend to involve substantial momentum effects, and path dependence. That our models reflect those mechanisms and aspects forms the foundation of their claim to being called “history-friendly models.” They portray the dynamic features of real economic causation, as described in empirical studies.

The constraints on mathematical analysis have obviously been relaxed a good deal since Marshall was turning out the successive editions of his Principles, roughly a century ago.