Dynamcis of technological change and schemes of diffusion

This paper attempts to analyze a technical change at the industry level by rendering explicit the investment behavior of the firms. The authors develop a model based on the assumption that production technology can be either modern or traditional. The probability that a firm modernizes is assumed to...

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Bibliographic Details
Published inIDEAS Working Paper Series from RePEc
Main Authors Petit, Pascal, Gabriel, Tahar
Format Paper
LanguageEnglish
Published St. Louis Federal Reserve Bank of St. Louis 01.01.1987
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Summary:This paper attempts to analyze a technical change at the industry level by rendering explicit the investment behavior of the firms. The authors develop a model based on the assumption that production technology can be either modern or traditional. The probability that a firm modernizes is assumed to be a function of market conditions and of performances of equipments. This behavior, combined with the general movement of investments driven by market prospects, sets the pace and shape of diffusion. Using a simple indicator of modernization, the model is estimated for five OECD countries between 1974 and 1982. Copyright 1989 by Blackwell Publishers Ltd and The Victoria University of Manchester(This abstract was borrowed from another version of this item.)