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Learning-by-Doing and the Choice of Technology: The Role of Patience

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  • Karp, Larry
  • Lee, In Ho

Abstract

If agents learn-by-doing and are myopic, less advanced firms might adopt new technologies while more advanced ¿rms stick with the old technology. This kind of overtaking can also occur if agents are forward looking and have high discount rates. However, overtaking never occurs if agents are sufficiently patient. A finite discount rate increases the set of states at which agents adopt new technologies, so more patient agents tend to upgrade their technology more frequently.
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  • Karp, Larry & Lee, In Ho, 2001. "Learning-by-Doing and the Choice of Technology: The Role of Patience," Journal of Economic Theory, Elsevier, vol. 100(1), pages 73-92, September.
  • Handle: RePEc:eee:jetheo:v:100:y:2001:i:1:p:73-92
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    1. Parente Stephen L., 1994. "Technology Adoption, Learning-by-Doing, and Economic Growth," Journal of Economic Theory, Elsevier, vol. 63(2), pages 346-369, August.
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    Cited by:

    1. Rob Hart, 2009. "Bad Eggs, Learning-by-doing, and the Choice of Technology," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 42(4), pages 429-450, April.
    2. Marisa Cenci & Margherita Scarlato, 2002. "Istituzioni e mercato del lavoro nel Mezzogiorno d’Italia: un’analisi dinamica," Rivista di Politica Economica, SIPI Spa, vol. 92(3), pages 281-320, May-June.
    3. Rivas, Javier, 2010. "The effects of the market structure on the adoption of evolving technologies," Journal of Economic Dynamics and Control, Elsevier, vol. 34(12), pages 2485-2493, December.
    4. Mateos-Planas, Xavier, 2004. "Technology adoption with finite horizons," Journal of Economic Dynamics and Control, Elsevier, vol. 28(11), pages 2129-2154, October.
    5. Hill, William W. & Beatty, Sharon E., 2011. "A model of adolescents' online consumer self-efficacy (OCSE)," Journal of Business Research, Elsevier, vol. 64(10), pages 1025-1033, October.
    6. James G. Mulligan & Nilotpal Das, 2005. "Persistent Adoption of Time-Saving Process Innovations," Working Papers 05-03, University of Delaware, Department of Economics.

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