IDEAS home Printed from https://ideas.repec.org/a/oup/oxecpp/v38y1986i0p219-43.html
   My bibliography  Save this article

Sequential Research and the Adoption of Innovations

Author

Listed:
  • Bhattacharya, Sudipto
  • Chatterjee, Kalyan
  • Samuelson, Larry

Abstract

The authors examine a firm able to adopt an innovation of uncertain profitability; reject the innovation; or delay deciding in order to acquire information on profitability. Deriving the optim al strategy from established sequential sampling literature, the authors constru ct a theory of the diffusion of innovation. Firms are assumed to hold identical prior expectations of an innovation's profitability, and to conduct privately ob served experiments on its profitability. The naturally arising distribution of e xperimental results yields a distribution of adoption times exhibiting establish ed facts on innovation diffusion. Finally the authors examine the implications o f strategic interactions between firms, where this affects both the learning pro cess and the results of adoption. Copyright 1986 by Royal Economic Society.

Suggested Citation

  • Bhattacharya, Sudipto & Chatterjee, Kalyan & Samuelson, Larry, 1986. "Sequential Research and the Adoption of Innovations," Oxford Economic Papers, Oxford University Press, vol. 38(0), pages 219-243, Suppl. No.
  • Handle: RePEc:oup:oxecpp:v:38:y:1986:i:0:p:219-43
    as

    Download full text from publisher

    File URL: http://links.jstor.org/sici?sici=0030-7653%28198611%292%3A38%3C219%3ASRATAO%3E2.0.CO%3B2-3&origin=bc
    File Function: full text
    Download Restriction: Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Alvarez, Luis H. R. & Stenbacka, Rune, 2001. "Adoption of uncertain multi-stage technology projects: a real options approach," Journal of Mathematical Economics, Elsevier, vol. 35(1), pages 71-97, February.
    2. Fabiano Schivardi & Martin Schneider, 2008. "Strategic Experimentation and Disruptive Technological Change," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 11(2), pages 386-412, April.
    3. Vesa Kanniainen, 1993. "Optimal production of innovations under uncertainty," Journal of Economics, Springer, vol. 57(2), pages 147-168, June.
    4. Jabbar, Mohammad A. & Beyene, Hailu & Mohamed Saleem, M A & Gebreselassie, Solomon, 1998. "Adoption pathways for new agricultural technologies : An approach and an application to Vertisols management technology in Ethiopia," Research Reports 182901, International Livestock Research Institute.
    5. Erin L. Scott & Pian Shu & Roman M. Lubynsky, 2015. "Are “Better” Ideas More Likely to Succeed? An Empirical Analysis of Startup Evaluation," Harvard Business School Working Papers 16-013, Harvard Business School.
    6. Hirshleifer, David & Teoh, Siew Hong, 2008. "Thought and Behavior Contagion in Capital Markets," MPRA Paper 9164, University Library of Munich, Germany.
    7. Doraszelski, Ulrich, 2004. "Innovations, improvements, and the optimal adoption of new technologies," Journal of Economic Dynamics and Control, Elsevier, vol. 28(7), pages 1461-1480, April.
    8. Farzin, Y. H. & Huisman, K. J. M. & Kort, P. M., 1998. "Optimal timing of technology adoption," Journal of Economic Dynamics and Control, Elsevier, vol. 22(5), pages 779-799, May.
    9. Verkerk, M. & van der Pijl, G.J. & van Asperen, E., 2009. "ICT as an Enabler for Innovation Adoption," Econometric Institute Research Papers EI 2009-15, Erasmus University Rotterdam, Erasmus School of Economics (ESE), Econometric Institute.
    10. Ahsanuzzaman, Ahsanuzzaman, 2015. "Duration Analysis of Technology Adoption in Bangladeshi Agriculture," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 200406, Agricultural and Applied Economics Association;Western Agricultural Economics Association.
    11. Yoris A. Au & Kim Huat Goh & Robert J. Kauffman & Frederick J. Riggins, 2007. "Planning Technology Investments For High Payoffs: A Rational Expectations Approach To Gauging Potential And Realized Value In A Changing Environment," Working Papers 0014, College of Business, University of Texas at San Antonio.
    12. Dutta, Jayasri & Prasad, Kislaya, 1996. "Learning by observation within the firm," Journal of Economic Dynamics and Control, Elsevier, vol. 20(8), pages 1395-1425, August.
    13. Karaaslan, Mehmet E., 2007. "Monopoly, Diversification through Adjacent Technologies, and Market Structure," MPRA Paper 7607, University Library of Munich, Germany.
    14. Bolton, P. & Harris, C., 1996. "Strategic Experimentation : A Revision," Discussion Paper 1996-27, Tilburg University, Center for Economic Research.
    15. Yoris A. Au & Kim Huat Goh & Robert J. Kauffman & Frederick J. Riggins, 2007. "Planning Technology Investments For High Payoffs: A Rational Expectations Approach To Gauging Potential And Realized Value In A Changing Environment," Working Papers 0014, College of Business, University of Texas at San Antonio.
    16. David Hirshleifer & Siew Hong Teoh, 2003. "Herd Behaviour and Cascading in Capital Markets: a Review and Synthesis," European Financial Management, European Financial Management Association, vol. 9(1), pages 25-66.
    17. Aramonte, Sirio, 2015. "Innovation, investor sentiment, and firm-level experimentation," Finance and Economics Discussion Series 2015-67, Board of Governors of the Federal Reserve System (U.S.).
    18. John C. Persons & Vincent A. Warther, "undated". "Boom and Bust Patterns in the Adoption of Financial Innovations," Research in Financial Economics 9601, Ohio State University.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:oup:oxecpp:v:38:y:1986:i:0:p:219-43. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Oxford University Press) or (Christopher F. Baum). General contact details of provider: https://academic.oup.com/oep .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.