Value Creation and Structural Change during the Third industrial Revolution. The Swedish Economy from a Vertical Perspective.

Abstract: This thesis analyses structural changes and the role of technology in the Swedish economy since the 1970s. With the attention directed towards interdependencies between sectors, a vertical perspective is applied on the economy. This contrats to the most often used horizontal perspective, in which individual sectors, such as manufacturing and services, are studied in isolation. With an integration of evolutionary economics and input-output economics, the aim of this thesis is to investigate to what extent five horizontally oriented notions - (1) more vertically disintegrated production processes, (2) a deindustrialized economy, (3) the growing importance of the business services sector as a distributor and generator of growth enhancing knowledge, (4) the distinction between a low productivity service sector and a high productivity manufacturing sector and (5) reduced competitiveness - remain valid when a vertical perspective is applied on the contemporary Swedish economy. Are the notions dependent on the particular perspective applied? To what extent will the vertical perspective gradade the general understanding of value creation and structural change? Investigating the five notions with input-output techniques, it is argued that a vertical perspective contributes to a new and more complete understanding of value creation and structural change in the Swedish economy during the Third industrial revolution. The emphasized notions are still valid, but they are dependent on the perspective applied to a non-negligible extent. A vertical perspective on value creation and structural change therefore gradates the interpretations of some generally accepted notions concerning the contemporary Swedish economy. Not the least, the chosen perspective illuminates some of the underlying mechanisms behind the structural changes among horizontally represented sectors. In this way, this thesis complements the existing knowledge concerning structural change and the role of technology in the growth process.