A Means—Variance Approach to the Theory of Intrafirm Diffusion

Paul Stoneman and W. Ochoro
Additional contact information
W. Ochoro: University of Warwick

Chapter 2 in The Economics of Technological Progress, 1980, pp 22-39 from Palgrave Macmillan

Abstract: Abstract The core of microeconomic studies of technological change is the theory of diffusion—the theory of the determinants of the spread of a new technology over all its possible uses. Although numerous empirical studies have been undertaken over the years (see Kennedy and Thirlwall, 1972), the theory itself is still in its infancy. The central approach is attributed to Mansfield (1968) but his theory involves little more than a Taylor’s expansion of an assumed general form (the work of Davies (1978) represents something of an advance on this). However, one of the big problems associated with a new technology is its riskiness, and the existing literature makes little allowance for this in the modelling process. In this paper we face the problem squarely by the use of a means-variance approach. We realize that this approach has its problems, but as Green (1971) states, this model has the great advantage of simplicity. The primary objective is to see under what conditions the model will predict the central result of diffusion studies—the existence of an S-shaped diffusion curve, and what this implies about the determinants of the diffusion speed.

Keywords: Variance Approach; Technological Progress; Learning Mechanism; Time Path; Diffusion Curve (search for similar items in EconPapers)
Date: 1980
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-1-349-16446-2_2

Ordering information: This item can be ordered from
http://www.palgrave.com/9781349164462

DOI: 10.1007/978-1-349-16446-2_2

Access Statistics for this chapter

More chapters in Palgrave Macmillan Books from Palgrave Macmillan
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().