The role of semiconductor inputs in IT hardware price decline: computers vs. communications

Ana Aizcorbe, Kenneth Flamm and Anjum Khurshid

No 2002-37, Finance and Economics Discussion Series from Board of Governors of the Federal Reserve System (U.S.)

Abstract: Sharp declines in semiconductor prices are largely responsible for observed declines in computer prices. Although communications equipment also has a large semiconductor content, communications equipment prices do not fall nearly as fast as computer prices. This paper partly resolves the puzzle-first noted by Flamm(1989)-by demonstrating that prices for chips used in communications equipment do not fall nearly as fast as prices for those chips used in computers, and those differences are large enough to potentially explain all of the output price differences.

Keywords: Semiconductor industry; Prices; Computers (search for similar items in EconPapers)
Date: 2002
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Citations: View citations in EconPapers (7)

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