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Monopolistic Competition and the Diffusion of New Technology

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  • Georg Götz

Abstract

This article analyzes the adoption and diffusion of new technology in a market for a differentiated product with monopolistic competition. I show that in a noncooperative equilibrium ex ante identical firms adopt a new technology at different dates. This equilibrium can be described by a simple distribution function. For nonidentical firms, I state the conditions under which a positive relationship between firm size and speed of adoption exists. The model integrates rank and stock effects. I demonstrate that increased competition often promotes diffusion.

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Bibliographic Info

Article provided by The RAND Corporation in its journal RAND Journal of Economics.

Volume (Year): 30 (1999)
Issue (Month): 4 (Winter)
Pages: 679-693

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Handle: RePEc:rje:randje:v:30:y:1999:i:winter:p:679-693

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Cited by:
  1. Ederington, Josh & McCalman, Phillip, 2013. "Technology adoption, government policy and tariffication," Journal of International Economics, Elsevier, vol. 90(2), pages 337-347.
  2. Bulent Unel, . "The Interaction Between Technology Adoption and Trade When Firms are Heterogeneous," Departmental Working Papers 2010-03, Department of Economics, Louisiana State University.
  3. Jonathan Beck & Michal Grajek & Christian Wey, 2005. "Hypermarket Competition and the Diffusion of Retail Checkout Barcode Scanning," Discussion Papers of DIW Berlin 523, DIW Berlin, German Institute for Economic Research.
  4. Alberto Chong & Alejandro Micco, 2002. "The Internet and the Ability to Innovate in Latin America," Research Department Publications 4291, Inter-American Development Bank, Research Department.
  5. Brant Callaway & Vivek Ghosal, 2012. "Adoption and Diffusion of Health Information Technology - The Case of Primary Care Clinics," CESifo Working Paper Series 3925, CESifo Group Munich.
  6. Gotz, Georg, 2000. "Strategic timing of adoption of new technologies under uncertainty: A note," International Journal of Industrial Organization, Elsevier, vol. 18(2), pages 369-379, February.
  7. Pulkki-Brännström, Anni-Maria & Stoneman, Paul, 2013. "On the patterns and determinants of the global diffusion of new technologies," Research Policy, Elsevier, vol. 42(10), pages 1768-1779.
  8. Koellinger, Ph.D., 2008. "The Relationship between Technology, Innovation, and Firm Performance: Empirical Evidence on E-Business in Europe," ERIM Report Series Research in Management ERS-2008-031-ORG, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus Uni.
  9. Ferdinand Rauch, 2008. "An explanation for the inverted-U relationship between competition and innovation," Vienna Economics Papers 0813, University of Vienna, Department of Economics.

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