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Zvi Griliches and the Economics of Technology Diffusion: Adoption of Innovations, Investment Lags, and Productivity Growth

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  • Paul A. David

    () (Department of Economics, Stanford University)

Abstract

This paper considers the scientific legacy of Zvi Griliches’ contribution to the economic analysis of the diffusion of technological innovations. It first examines the relationship between Griliches’ pioneering empirical work on the introduction and adoption of hybrid corn and the subsequent development of theoretical models and econometric research on the microeconomic determinants of diffusion. Next, it formalizes the way that structural conditions at the micro-level shape the dynamics of diffusion phenomena observable at the level of industries and even sectors, and are reflected in the lagged behavior of aggregate investment in capital-embodied innovations. Thirdly, it extends the latter perspective to make explicit the micro-to-macro relationships affecting the total factor productivity (TFP) growth rate. These three dynamic phenomena --diffusion, lags, and TFP growth – were the topics of Griliches’ three most widely cited among journal articles, respectively. Directing attention to the microeconomics of technology adoption underlying the ‘transitions’ during which the diffusion of major innovations generate surges in innovation embodying capital formation, and waves in the TFP growth, figures prominently among Griliches’ important contributions to modern economics.

Suggested Citation

  • Paul A. David, "undated". "Zvi Griliches and the Economics of Technology Diffusion: Adoption of Innovations, Investment Lags, and Productivity Growth," Discussion Papers 09-016, Stanford Institute for Economic Policy Research, revised Mar 2010.
  • Handle: RePEc:sip:dpaper:09-016
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    References listed on IDEAS

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    1. repec:oxf:wpaper:303 is not listed on IDEAS
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    More about this item

    Keywords

    Zvi Griliches; diffusion of technology; TFP growth;

    JEL classification:

    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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