IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this paper or follow this series

The Impact of Competition on Technology Adoption: An Apples-to-PCs Analysis

Author Info

  • Adam Hale Shapiro

    (Bureau of Economic Analysis)

  • Adam Copeland

    (Federal Reserve Bank of New York)

Abstract

We study the effect of market structure on a firm's decision to adopt a new technology in the personal computer industry. This industry is unusual because there exists two horizontally segmented retail markets with different degrees of competition: the IBM compatible (or ``PC") platform and the Apple platform. We first document that relative to Apple, producers of PCs have more frequent technology adoption, shorter product cycles, and steeper price declines over the product cycle. We then develop a parsimonious vintage-capital model which is able to match the different stylized facts of PC and Apple producers. The model predicts that competition is the key driver of the rate at which technology is adopted.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: https://www.economicdynamics.org/meetpapers/2010/paper_181.pdf
Download Restriction: no

Paper provided by Society for Economic Dynamics in its series 2010 Meeting Papers with number 181.

as
in new window

Length:
Date of creation: 2010
Date of revision:
Handle: RePEc:red:sed010:181
Contact details of provider: Postal: Society for Economic Dynamics Christian Zimmermann Economic Research Federal Reserve Bank of St. Louis PO Box 442 St. Louis MO 63166-0442 USA
Fax: 1-314-444-8731
Web page: http://www.EconomicDynamics.org/society.htmEmail:


More information through EDIRC

Keywords:

Other versions of this item:

Find related papers by JEL classification:
  • E6 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Johannes Van Biesebroeck & Aamir Hashmi, 2007. "Market Structure and Innovation: A Dynamic Analysis of the Global Automobile Industry," 2007 Meeting Papers 362, Society for Economic Dynamics.
  2. Brett Gordon & Ronald Goettler, 2010. "Does AMD spur Intel to innovate more?," 2010 Meeting Papers 151, Society for Economic Dynamics.
  3. Ana Aizcorbe & Samuel Kortum, 2004. "Moore's Law and the Semiconductor Industry: A Vintage Model," Industrial Organization 0412008, EconWPA.
  4. Howitt, Peter & Griffith, Rachel & Aghion, Philippe & Blundell, Richard & Bloom, Nick, 2005. "Competition and Innovation: An Inverted-U Relationship," Scholarly Articles 4481507, Harvard University Department of Economics.
  5. Gilbert, Richard J & Newbery, David M G, 1982. "Preemptive Patenting and the Persistence of Monopoly," American Economic Review, American Economic Association, vol. 72(3), pages 514-26, June.
  6. Timothy Erickson & Ariel Pakes, 2008. "An Experimental Component Index for the CPI: From Annual Computer Data to Monthly Data on Other Goods," NBER Working Papers 14368, National Bureau of Economic Research, Inc.
  7. Ana Aizcorbe, 2005. "Moore's Law, Competition, and Intel's Productivity in the Mid-1990s," American Economic Review, American Economic Association, vol. 95(2), pages 305-308, May.
  8. Borenstein, Severin & Rose, Nancy L, 1994. "Competition and Price Dispersion in the U.S. Airline Industry," Journal of Political Economy, University of Chicago Press, vol. 102(4), pages 653-83, August.
  9. Kristopher S. Gerardi & Adam Hale Shapiro, 2009. "Does Competition Reduce Price Dispersion? New Evidence from the Airline Industry," Journal of Political Economy, University of Chicago Press, vol. 117(1), pages 1-37, 02.
  10. Aamir Rafique HASHMI & Johannes VAN BIESEBROECK, 2012. "The relationship between market structure and innovation in industry equilibrium: a case study of the global automobile industry," Center for Economic Studies - Discussion papers ces12.01, Katholieke Universiteit Leuven, Centrum voor Economische Studiën.
  11. Aghion, Philippe & Howitt, Peter, 1992. "A Model of Growth Through Creative Destruction," Scholarly Articles 12490578, Harvard University Department of Economics.
Full references (including those not matched with items on IDEAS)

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

as in new window


Cited by:

  1. CASTRO, Rui & CLEMENTI, Gian Luca & LEE, Yoonsoo, 2013. "Cross-sectoral variation in the volatility of plant-level idiosyncratic shocks," Cahiers de recherche 2014-09, Universite de Montreal, Departement de sciences economiques.
  2. Adam Hale Shapiro & Ana Aizcorbe, 2010. "Implications of Consumer Heterogeneity on Price Measures for Technology Goods," BEA Working Papers 0062, Bureau of Economic Analysis.
  3. Slivko, Olga, 2012. "Direct and indirect subsidies in markets with system goods in the presence of externalities. Preliminary version," Working Papers 2072/211631, Universitat Rovira i Virgili, Department of Economics.

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Access and download statistics

When requesting a correction, please mention this item's handle: RePEc:red:sed010:181. 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: (Christian Zimmermann)

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.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with 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 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.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.