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Prices for local area network equipment

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Author Info

  • Mark Doms
  • Chris Forman

Abstract

In this paper we examine quality-adjusted prices for local area network (LAN) equipment. Hedonic regressions are used to estimate price changes for the two largest classes of LAN equipment, routers and switches. A matched model was used for LAN cards and the prices for hubs were inferred by using an economic relationship to switches. Overall, we find that prices for the four groups of LAN equipment fell at a 17 percent annual rate between 1995 and 2000. These results stand in sharp contrast to the PPI for communications equipment that is nearly flat over the 1990s.

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Bibliographic Info

Paper provided by Federal Reserve Bank of San Francisco in its series Working Papers in Applied Economic Theory with number 2003-13.

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Date of creation: 2003
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Publication status: Published in Information Economics and Policy, v. 17, no. 3 (July 2005) pp. 365-388
Handle: RePEc:fip:fedfap:2003-13

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Keywords: High technology industries ; Prices ; Computers;

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References

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  1. Feenstra, R.C., 1995. "Exact Hedonic Price Indexes," Department of Economics 95-11, California Davis - Department of Economics.
  2. Gordon, Robert J., 1990. "The Measurement of Durable Goods Prices," National Bureau of Economic Research Books, University of Chicago Press, edition 1, number 9780226304557, April.
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  6. Carol Corrado, 2001. "Industrial production and capacity utilization: the 2000 annual revision," Federal Reserve Bulletin, Board of Governors of the Federal Reserve System (U.S.), issue Mar, pages 132-148.
  7. Matthew D. Shapiro & David W. Wilcox, 1996. "Mismeasurement in the Consumer Price Index: An Evaluation," NBER Chapters, in: NBER Macroeconomics Annual 1996, Volume 11, pages 93-154 National Bureau of Economic Research, Inc.
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  11. Klemperer, Paul, 1992. "Competition When Consumers Have Switching Costs: An Overview," CEPR Discussion Papers 704, C.E.P.R. Discussion Papers.
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  13. Harchaoui, Tarek M. & Hamdad, Malika, 2000. "The prices of classical recorded music: a hedonic approach," International Journal of Industrial Organization, Elsevier, vol. 18(3), pages 497-514, April.
  14. Hausman, Jerry, 1999. "Cellular Telephone, New Products, and the CPI," Journal of Business & Economic Statistics, American Statistical Association, vol. 17(2), pages 188-94, April.
  15. Ana Aizcorbe & Kenneth Flamm & Anjum Khurshid, 2002. "The role of semiconductor inputs in IT hardware price decline: computers vs. communications," Finance and Economics Discussion Series 2002-37, Board of Governors of the Federal Reserve System (U.S.).
  16. Gort, Michael & Klepper, Steven, 1982. "Time Paths in the Diffusion of Product Innovations," Economic Journal, Royal Economic Society, vol. 92(367), pages 630-53, September.
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Citations

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Cited by:
  1. John Van Reenen, 2005. "The Growth of Network Computing: Quality Adjusted Price Changes for Network Servers," CEP Discussion Papers dp0702, Centre for Economic Performance, LSE.
  2. Mark C. Doms, 2004. "The boom and bust in information technology investment," Economic Review, Federal Reserve Bank of San Francisco, pages 19-34.
  3. Jacqueline M. Hamilton, 2005. "Coastal landscape and the hedonic price of accommodation," Working Papers FNU-91, Research unit Sustainability and Global Change, Hamburg University, revised Sep 2005.
  4. Stranger, Greg & Greenstein, Shane, 2008. "Pricing in the shadow of firm turnover: ISPs during the 1990s," International Journal of Industrial Organization, Elsevier, vol. 26(3), pages 625-642, May.
  5. Paul Chwelos, 2003. "Approaches to performance measurement in hedonic analysis: Price indexes for laptop computers in the 1990's," Economics of Innovation and New Technology, Taylor and Francis Journals, vol. 12(3), pages 199-224.

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