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He came, he saw, (and) he waited: an empirical analysis of inertia in technology adoption

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  • Diansheng Dong
  • Atanu Saha

Abstract

The innovation adoption literature has focused primarily on a producer's decision of whether and how much to adopt. An equally pertinent question is when to adopt, because in the case of new technologies it often 'pays to wait' for more information. We propose a double-limit hurdle model to analyse adoption intensity and inertia in the context of a divisible technology. The proposed framework incorporates probit or Tobit models as testable special cases. A maximum likelihood estimation framework is set out and generalized to account for heteroscedastic errors. The empirical analysis, which uses household-level data from India's semi-arid tropics, provides new insights into the factors influencing adoption inertia and intensity.

Suggested Citation

  • Diansheng Dong & Atanu Saha, 1998. "He came, he saw, (and) he waited: an empirical analysis of inertia in technology adoption," Applied Economics, Taylor & Francis Journals, vol. 30(7), pages 893-905.
    • Handle: RePEc:taf:applec:v:30:y:1998:i:7:p:893-905
    DOI: 10.1080/000368498325327
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    1. R.K. Lindner & A.J. Fischer, 1981. "Risk Aversion, Information Quality and the Innovation Adoption Time Lag," School of Economics and Public Policy Working Papers 1981-17, University of Adelaide, School of Economics and Public Policy.
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    1. Löfgren, Åsa & Millock, Katrin & Nauges, Céline, 2008. "The effect of uncertainty on pollution abatement investments: Measuring hurdle rates for Swedish industry," Resource and Energy Economics, Elsevier, vol. 30(4), pages 475-491, December.
    2. LOFGREN Asa & MILLOCK Katrin & NAUGES Céline, 2007. "Using Ex Post Data to Estimate the Hurdle Rate of Abatement Investments - An application to the Swedish Pulp and Paper Industry and Energy Sector," LERNA Working Papers 07.06.227, LERNA, University of Toulouse.
    3. Ursula Aldana & Jeremy D. Foltz & Bradford L. Barham & Pilar Useche, 2010. "Sequential Adoption of Package Technologies: The Dynamics of Stacked Trait Corn Adoption," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 93(1), pages 130-143.
    4. Adela Luque, 2003. "The Role of Technological and Industrial Heterogeneity In Technology Diffusion: a Markovian Approach," Working Papers 03-07, Center for Economic Studies, U.S. Census Bureau.
    5. Pannell, David J. & Pardey, Philip G. & Hurley, Terrence M., 2020. "Private Incentives for Sustainable Agriculture: Principals and Evidence for Sustainable Agricultural Change," Working Papers 304700, University of Western Australia, School of Agricultural and Resource Economics.
    6. Grisham, Elisabeth & Gillespie, Jeffrey M., 2007. "Record-Keeping Technology Adoption in the Louisiana Dairy Industry," 2007 Annual Meeting, February 4-7, 2007, Mobile, Alabama 34975, Southern Agricultural Economics Association.
    7. Kanchan Joshi & Thiagu Ranganathan & Ram Ranjan, 2021. "Exploring Higher Order Risk Preferences of Farmers in a Water-Scarce Region: Evidence from a Field Experiment in West Bengal, India," Journal of Quantitative Economics, Springer;The Indian Econometric Society (TIES), vol. 19(2), pages 317-344, June.
    8. László Csorba, 2019. "Issues and Types of Adverse Selection and Negative Selection," Financial and Economic Review, Magyar Nemzeti Bank (Central Bank of Hungary), vol. 18(2), pages 87-116.
    9. McEachern, Menzie & Hanson, Susan, 2008. "Socio-geographic perception in the diffusion of innovation: Solar energy technology in Sri Lanka," Energy Policy, Elsevier, vol. 36(7), pages 2578-2590, July.
    10. Corrocher, Nicoletta & Fontana, Roberto, 2008. "Objectives, obstacles and drivers of ICT adoption: What do IT managers perceive?," Information Economics and Policy, Elsevier, vol. 20(3), pages 229-242, September.
    11. Syster C. Maart-Noelck & Oliver Musshoff & Moritz Maack, 2013. "The impact of price floors on farmland investments: a real options based experimental analysis," Applied Economics, Taylor & Francis Journals, vol. 45(35), pages 4872-4882, December.
    12. Abdulai, Awudu & Owusu, Victor & Bakang, John-Eudes A., 2011. "Adoption of safer irrigation technologies and cropping patterns: Evidence from Southern Ghana," Ecological Economics, Elsevier, vol. 70(7), pages 1415-1423, May.
    13. Anna Giunta & Francesco Trivieri, 2007. "Understanding the determinants of information technology adoption: evidence from Italian manufacturing firms," Applied Economics, Taylor & Francis Journals, vol. 39(10), pages 1325-1334.
    14. Åsa Löfgren & Katrin Millock & Céline Nauges, 2008. "Using ex post data to estimate the hurdle rate of abatement investments - an application to sulfur emissions from the Swedish pulp and paper industry and energy sector," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00261523, HAL.
    15. Grisham, Elisabeth & Gillespie, Jeffrey, 2008. "Record-Keeping Technology Adoption among Dairy Farmers," Journal of the ASFMRA, American Society of Farm Managers and Rural Appraisers, vol. 2008, pages 1-12.
    16. Ishika Gupta & Prakashan Chellattan Veettil & Stijn Speelman, 2020. "Caste, Social Networks and Variety Adoption," Journal of South Asian Development, , vol. 15(2), pages 155-183, August.
    17. Ira Matuschke & Matin Qaim, 2009. "The impact of social networks on hybrid seed adoption in India," Agricultural Economics, International Association of Agricultural Economists, vol. 40(5), pages 493-505, September.
    18. Martin, Ludivine, 2009. "Understanding the implementation of e-business strategies: Evidence from Luxembourg," MPRA Paper 13645, University Library of Munich, Germany.
    19. Alwin Keil & Alwin D’souza & Andrew McDonald, 2017. "Zero-tillage is a proven technology for sustainable wheat intensification in the Eastern Indo-Gangetic Plains: what determines farmer awareness and adoption?," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 9(4), pages 723-743, August.
    20. Matthias Berger & Christian Matt & Jochen Gönsch & Thomas Hess, 2019. "Is the Time Ripe? How the Value of Waiting and Incentives Affect Users’ Switching Behaviors for Smart Home Devices," Schmalenbach Business Review, Springer;Schmalenbach-Gesellschaft, vol. 71(1), pages 91-123, February.
    21. Anil Nair & Orhun Guldiken & Stav Fainshmidt & Amir Pezeshkan, 2015. "Innovation in India: A review of past research and future directions," Asia Pacific Journal of Management, Springer, vol. 32(4), pages 925-958, December.
    22. Jan Hinrichs & Oliver Musshoff & Martin Odening, 2008. "Economic hysteresis in hog production," Applied Economics, Taylor & Francis Journals, vol. 40(3), pages 333-340.
    23. Johan F.M.Swinnen & Thijs Vandemoortele, 2011. "On Butterflies and Frankenstein: A Dynamic Theory of Regulation," LICOS Discussion Papers 27611, LICOS - Centre for Institutions and Economic Performance, KU Leuven.

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