Defining Tech: An Examination of How the ‘Technology’ Economy Is Measured

Abstract

The paper conducts a comprehensive review and critical comparison of the empirical methodologies for defining the high-technology sector (or ‘tech’) in social science research and analysis. It consolidates both qualitative (expert-based) approaches and quantitative (threshold-based) approaches for the broader audience of researchers. In the quantitative approaches, the paper identifies two accepted metrics and two loosely defined criteria used in distinguishing tech. The paper finds a generally consistent theoretical conceptualization for how to distinguish tech from other sectors, but inconsistency and no consensus on the implementation of that theory in applied research methods. The paper proposes two steps forward for future methodologies by identifying of a set of consensus industries present across tech definitions and by arguing for a continuum-based approach to identifying technology intensity in industries, businesses, and products/services.

Keywords: technology sector, digital economy, online platforms, technology theory, measurement of technology

JEL Classification: P00, O3