We argue that the information technology revolution has brought about the differentiation of secular capital-using and labour-saving direction of technical change. Based on the example of the US manufacturing industry, asset and sector specific differences in the bias of technical change are documented. While the clear ICT- and intangible capital-using bias of technical change is well-documented in the literature, this paper provides evidence for the non-ICT capital-saving bias of technical change in the fifth Kondratieff cycle. In the past decade the US manufacturing sector displayed a noticeable deceleration of capital accumulation and capital intensity increase, a trend that diverges from the one observed in the other two sectors of the economy: in agriculture and in services. Non-ICT capital-saving technical change provokes increasing divergence between the development strategies of technological followers (characterised by tangible investment-led growth, and increasing capital-output ratios), and of technological leaders (marked by increasing intangible capital-intensity and diminishing tangible capital-intensity).
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