Frictionless technology diffusion: the case of tractors

Rodolfo Manuelli and Ananth Seshadri

No 2013-022, Working Papers from Federal Reserve Bank of St. Louis

Abstract: Empirical evidence suggests that there is a long lag between the time a new technology is introduced and the time at which it is widely adopted. The conventional wisdom is that this fact is inconsistent with the predictions of the frictionless neoclassical model. In this paper we study the specific case of the diffusion of the tractor in American agriculture between 1910 and 1960. There are three important driving forces: changes in quality, wage rates and prices of substitutes such as horses and mules. We demonstrate that once these exogenous forces are taken into account, the standard neoclassical model can account for ?slow? pattern of adoption of tractors that took more than 50 years.

Keywords: Technology; -; Economic; aspects (search for similar items in EconPapers)
Date: 2013
New Economics Papers: this item is included in nep-cwa and nep-dge
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Related works:
Journal Article: Frictionless Technology Diffusion: The Case of Tractors (2014)
Journal Article: Frictionless technology diffusion: the case of tractors (2003)
Working Paper: Frictionless Technology Diffusion: The Case of Tractors (2003)
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