Diffusion of General Purpose Technologies
History and theory alike suggest that General Purpose Technologies (GPT's), such as the steam engine or electricity, may play a key role in economic growth. In a previous paper (Helpman and Trajtenberg, 1994) we incorporated this notion into a Grossman-Helpman growth model, and explored the economy-wide dynamics that a GPT generates. The present paper deals with the diffusion of the GPT over heterogeneous final-good sectors. We show that the gradual adoption of the GPT by each user sector generates a sequence of two-phased cycles, culminating in a bringing about a spell of sustained growth. We also analyze the welfare implications of the order of adoption, by way of numerical simulations. As a diffusion of the transistor (the first embodiment of semiconductors, the dominant GPT of our era), and seek to characterize both the early adopters and the laggards in terms of the parameters of the model.
|Date of creation:||Sep 1996|
|Publication status:||published as General Purpose Technologies and Economic Growth, Helpman, E., ed., Cambridge: MIT Press, 1998.|
|Contact details of provider:|| Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.|
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- Bresnahan, Timothy F. & Trajtenberg, M., 1995.
"General purpose technologies 'Engines of growth'?,"
Journal of Econometrics,
Elsevier, vol. 65(1), pages 83-108, January.
- Timothy F. Bresnahan & Manuel Trajtenberg, 1992. "General Purpose Technologies "Engines of Growth?"," NBER Working Papers 4148, National Bureau of Economic Research, Inc.
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- Judd, Kenneth L, 1985. "On the Performance of Patents," Econometrica, Econometric Society, vol. 53(3), pages 567-585, May. Full references (including those not matched with items on IDEAS)
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