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Diffusion of New Technology in Indian Auto Component Industry: An Examination of the Determinants of Adoption


  • Parhi, Mamata

    () (United Nations University, Institute for New Technologies)


The contribution of new technologies to economic growth is harnessed only when new technologies are widely diffused in the economy. Diffusion results from a series of individual decisions to introduce the new technologies, decisions being the result of a comparison of the uncertain benefits and costs associated with adoption. An understanding of the factors affecting this choice is therefore an essential step forward in order to study the diffusion process of new technologies. The aim of this paper is to provide a comprehensive understanding of the possible set of factors determining adoption of new technologies such as Advanced Manufacturing Techniques (AMTs) in the Indian auto component industry. Building on both the early ‘epidemic' and the later ‘equilibrium' theories of adoption, our analysis is purported to provide an empirical exploration of determinants of adoption that takes into account the influence of structural, (i.e., firm-specific), and socio-economic factors on the process of adoption. Our results, though confirms most of the theoretical and empirical predictions about technology adoption, provides new evidence on the importance of external sources of knowledge and the crucial role of demand side on the adoption process.

Suggested Citation

  • Parhi, Mamata, 2005. "Diffusion of New Technology in Indian Auto Component Industry: An Examination of the Determinants of Adoption," UNU-INTECH Discussion Paper Series 08, United Nations University - INTECH.
  • Handle: RePEc:unm:unuint:200508

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    References listed on IDEAS

    1. Eleonora Bartoloni & Maurizio Baussola, 2001. "The Determinants of Technology Adoption in Italian Manufacturing Industries," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 19(3), pages 305-328, November.
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    9. Baldwin, John R. & Raffiquzzaman, Mohammed, 1998. "The Determinants of the Adoption Lag for Advanced Manufacturing Technologies," Analytical Studies Branch Research Paper Series 1998117e, Statistics Canada, Analytical Studies Branch.
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    Technology Transfer; Diffusion of Innovations; Management Techniques; Production Control; Industrial Management; Industrial Cooperation; Automotive Industry; India;

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    1. Studies on the automobile industry


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