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The Production Recipes Approach to Modeling Technological Innovation: An Application to Learning By Doing

  • Philip Auerswald
  • Stuart Kauffman
  • Jose Lobo
  • Karl Shell

We do two things in this paper. First, we put forward some elements of a microeconomic theory of technological evolution. This involves adding nascent (essentially undiscovered) technologies to the existing technologies of neoclassical production theory, and, more importantly, expanding the notion of the production plan to include the recipe---the complete description of the underlying engineering process. Second, we use the recipes approach in constructing a simple microeconomic model of shop-floor learning by doing. We simulate the dynamics of the model and report the effects of changes in the basic parameters on the resulting engineering experience curves. For correctly chosen values of these parameters, the predictions of the model match the observed data on experience curves. Journal of Economic Literature Classification Numbers: D20, D21, D24, D83, L23, O30. Submitted to Journal of Economic Dynamics and Control.

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Paper provided by Santa Fe Institute in its series Working Papers with number 98-11-100.

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Date of creation: Nov 1998
Date of revision:
Handle: RePEc:wop:safiwp:98-11-100
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  15. 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.
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  20. Levhari, David & Sheshinski, Eytan, 1973. "Experience and Productivity in the Israel Diamond Industry," Econometrica, Econometric Society, vol. 41(2), pages 239-53, March.
  21. Young, Alwyn, 1993. "Invention and Bounded Learning by Doing," Journal of Political Economy, University of Chicago Press, vol. 101(3), pages 443-72, June.
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  23. Richard R. Nelson & Edmond S. Phelps, 1965. "Investment in Humans, Technological Diffusion and Economic Growth," Cowles Foundation Discussion Papers 189, Cowles Foundation for Research in Economics, Yale University.
  24. 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.
  25. Kibria, Muhammad G & Tisdell, Clement A, 1985. "Productivity Progress Parameters for Manufacturing in an LDC: The Startup or Learning Phase in Bangladesh Jute Mills," Australian Economic Papers, Wiley Blackwell, vol. 24(45), pages 370-79, December.
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  27. Dudley, Leonard, 1972. "Learning and Productivity Change in Metal Products," American Economic Review, American Economic Association, vol. 62(4), pages 662-69, September.
  28. Peter F. Stadler & Robert Happel, 1995. "Random Field Models for Fitness Landscapes," Working Papers 95-07-069, Santa Fe Institute.
  29. 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.
  30. Argote, L. & Epple, D., 1990. "Learning Curves In Manufacturing," GSIA Working Papers 89-90-02, Carnegie Mellon University, Tepper School of Business.
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