Variety and the evolution of refinery processing
AbstractEvolutionary theories of economic development stress the role of variety as both a determinant and a result of growth. In this paper we develop a measure of variety, based on Weitzman's maximum likelihood procedure. This measure is based on the distance between products, and indicates the degree of differentiation of a product population. We propose a generic method, which permits to regroup the products with very similar characteristics values before choosing randomly the product models to be used to calculate Weitzman's measure. We apply the variety measure to process characteristics of oil refining. The results obtained for this technology show classic evolutionary specialization patterns that can be understood on the basis of niche theory. Here the changes in variety are related to changes in the range of the services the technology considered can deliver, range which plays a role similar to that of the size of the habitat of a biological species.
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Bibliographic InfoPaper provided by Grenoble Applied Economics Laboratory (GAEL) in its series Working Papers with number 200428.
Date of creation: 2004
Date of revision:
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TECHNOLOGICAL EVOLUTION; REFINERY PROCESSES; NICHE THEORY; WEITZMAN MEASURE;
Other versions of this item:
- L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
- L93 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Air Transportation
- Q40 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - General
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