What is a Technological Change? - Definition, Advantages, Impact & Examples

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Lesson Transcript
Instructor: Kimberly Winston

Kimberly has a MBA in Logistics & Supply Chain Management

How has technology changed your life in the last 5, 10, or 20 years? In this lesson, you will learn the definition of technological change as well as its advantages, impacts, and several examples.

What Is Technological Change

In economics, a technological change is an increase in the efficiency of a product or process that results in an increase in output, without an increase in input. In other words, someone invents or improves a product or process, which is then used to get a bigger reward for the same amount of work.

The telephone is an example of a product that has undergone a technological change. It has undergone many different changes over the years that have made it more efficient. Processes or products, such as the telephone, move through technological change in three stages:

  • Invention - the creation of a new product or process
  • Innovation - the application of the invention for the first time
  • Diffusion - how fast others begin to adopt the innovation

Impacts of Technological Change

We have all likely experienced the impact of technology. Let's take a look at the ways, both good and bad, technological change has impacted our world:

  • Creates new products and processes

When telephones were first invented, the object was to be able to verbally communicate with someone. Due to technological changes, we have multiple ways to communicate using our phones, such as text, email, or talk.

  • Increases efficiency, lower costs

Technology makes it possible to perform everyday tasks faster and with less energy on our part. For instance, some people have a vacuum cleaning robot. Instead of spending 30 minutes vacuuming, they push a button and go do something else. That's efficiency.

  • Helps economies evolve

People are able to increase the ways in which they create wealth. It also has a ripple effect. When one technological change occurs, it changes how we live. With the integration of technology, societies evolved from traditional hunting and gathering to industrialized. So that fewer people are growing crops and more are moving into other industries.

Almost every industry, such as aviation, education, or the medical field, have been improved by technological change. Think about how you are learning this very lesson today. How would students have obtained this information 50 years ago?

  • Decreases self-reliance

As technology changed over time, so too did our role in society. We are less self-reliant today, as we rely more and more on technology than our ancestors did.

  • Negatively affects the value of workers

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