Frictionless Technology Diffusion: The Case of Tractors

Rodolfo Manuelli and Ananth Seshadri

No 9604, NBER Working Papers from National Bureau of Economic Research, Inc

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 these observations are inconsistent with the predictions of the frictionless neoclassical model. In this paper we show this to be incorrect. Once the appropriate driving forces are taken into account, the neoclassical model can account for slow' adoption. We illustrate this by developing an industry model to study the equilibrium rate of diffusion of tractors in the U.S. between 1910 and 1960.

JEL-codes: E1 O3 (search for similar items in EconPapers)
Date: 2003-04
New Economics Papers: this item is included in nep-dev and nep-mic
Note: EFG PR
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Citations: View citations in EconPapers (15)

Published as Rodolfo Manuelli & Ananth Seshadri, 2003. "Frictionless technology diffusion: the case of tractors," Proceedings, Federal Reserve Bank of San Francisco, issue Nov.
Published as Rodolfo E. Manuelli & Ananth Seshadri, 2014. "Frictionless Technology Diffusion: The Case of Tractors," American Economic Review, vol 104(4), pages 1368-1391.

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Related works:
Journal Article: Frictionless Technology Diffusion: The Case of Tractors (2014)
Working Paper: Frictionless technology diffusion: the case of tractors (2013)
Journal Article: Frictionless technology diffusion: the case of tractors (2003)
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