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Scale in Technology and Learning-by-Doing in the Windmill Industry

  • Madsen, Erik Strøjer

    ()

    (Department of Economics, Aarhus School of Business)

  • Jensen, Camilla

    (Copenhagen Business School)

  • Hansen, Jørgen Drud

    (University of Southern Denmark)

This paper examines the remarkable development of technology and the fast learning-by-doing in the windmill industry since it emerged in the beginning of the 1980s. Based on time series of prices of windmills a dynamic cost function for producing windmills is tested. The estimations verified that learning-by-doing in the Danish windmill industry has contributed significantly to improve the cost efficiency of the producers. The technological development has been stimulated both by process and product innovations as the capacity of the individual mills has increased. The learning effect created by early subsidies from the government has consolidated the competitive advantages of the windmill cluster in Denmark and preserved the first mover advantages at the world market. The article concludes that the industry probably will enter into a matured phase in the future with more modest technological growth.

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File URL: http://www.hha.dk/nat/WPER/02-2_esm.pdf
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Paper provided by University of Aarhus, Aarhus School of Business, Department of Economics in its series Working Papers with number 02-2.

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Length: 18 pages
Date of creation: 01 Jan 2002
Date of revision:
Handle: RePEc:hhs:aareco:2002_002
Contact details of provider: Postal: The Aarhus School of Business, Prismet, Silkeborgvej 2, DK 8000 Aarhus C, Denmark
Phone: +45 89 486396
Fax: +45 8615 5175
Web page: http://www.asb.dk/departments/nat.aspx

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  1. Young, Alwyn, 1991. "Learning by Doing and the Dynamic Effects of International Trade," The Quarterly Journal of Economics, MIT Press, vol. 106(2), pages 369-405, May.
  2. Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, vol. 22(1), pages 3-42, July.
  3. Nancy L Stokey, 1986. "Learning-by-Doing and the Introduction of New Goods," Discussion Papers 699, Northwestern University, Center for Mathematical Studies in Economics and Management Science, revised May 1987.
  4. Kazuhiro Mishina, 1999. "Learning by New Experiences: Revisiting the Flying Fortress Learning Curve," NBER Chapters, in: Learning by Doing in Markets, Firms, and Countries, pages 145-184 National Bureau of Economic Research, Inc.
  5. Morthorst, P. E., 1999. "Capacity development and profitability of wind turbines," Energy Policy, Elsevier, vol. 27(13), pages 779-787, November.
  6. Alwyn Young, 1991. "Learning by Doing and the Dynamic Effects of International Trade," NBER Working Papers 3577, National Bureau of Economic Research, Inc.
  7. Young, Alwyn, 1993. "Invention and Bounded Learning by Doing," Journal of Political Economy, University of Chicago Press, vol. 101(3), pages 443-72, June.
  8. Dasgupta, Partha & Stiglitz, Joseph E, 1985. "Learning-by-doing, Market Structure and Industrial and Trade Policies," CEPR Discussion Papers 80, C.E.P.R. Discussion Papers.
  9. C. Lanier Benkard, 1999. "Learning and Forgetting: The Dynamics of Aircraft Production," NBER Working Papers 7127, National Bureau of Economic Research, Inc.
  10. Irwin, Douglas A & Klenow, Peter J, 1994. "Learning-by-Doing Spillovers in the Semiconductor Industry," Journal of Political Economy, University of Chicago Press, vol. 102(6), pages 1200-1227, December.
  11. Bahk, Byong-Hong & Gort, Michael, 1993. "Decomposing Learning by Doing in New Plants," Journal of Political Economy, University of Chicago Press, vol. 101(4), pages 561-83, August.
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