Technology shocks are events in a macroeconomic model, that change the production function. Usually this is modelled with an aggregate production function that has a scaling factor.
A technology shock affects an industry or firm's productivity, this may be a positive shock - increasing the output for a given set of inputs, or a negative shock - decreasing the output for a given set of inputs. Negative shocks are much less common than positive shocks as technology rarely moves backwards.
Famous quotes containing the words technology and/or shock:
“If the technology cannot shoulder the entire burden of strategic change, it nevertheless can set into motion a series of dynamics that present an important challenge to imperative control and the industrial division of labor. The more blurred the distinction between what workers know and what managers know, the more fragile and pointless any traditional relationships of domination and subordination between them will become.”
—Shoshana Zuboff (b. 1951)
“Civilized society is one huge bourgeoisie: no nobleman dares now shock his greengrocer.”
—George Bernard Shaw (1856–1950)