Technology adoption with finite horizons
Technology adoption with finite horizons
The purpose of this paper is to study the relation between the age of an agent and her decisions about adopting new technologies. To this end, I analyze the optimal sequence of technology upgrades by an agent who lives for a finite period of time. Other characteristics of the environment are the existence of technology-specific learning-by-doing, technology growth, and adoption costs. A finite planning horizon implies that the technology adoption problem is non-stationary and the frequency of adoptions changes over time. This paper provides results for the computation of the optimal plan and explores numerically the life-cycle pattern of technology switches. Adoptions may become more frequent as the agent grows older. However, the sign of the association between age and the adoption of new technologies is sensitive to variation in parameters. This is not at odds with the findings of recent empirical studies.
learning-by-doing, technology adoption
2129-2154
Mateos-Planas, Xavier
444f69bb-2ab3-4f56-be17-3f286f7700da
2004
Mateos-Planas, Xavier
444f69bb-2ab3-4f56-be17-3f286f7700da
Mateos-Planas, Xavier
(2004)
Technology adoption with finite horizons.
Journal of Economic Dynamics and Control, 28 (11), .
(doi:10.1016/j.jedc.2003.09.002).
Abstract
The purpose of this paper is to study the relation between the age of an agent and her decisions about adopting new technologies. To this end, I analyze the optimal sequence of technology upgrades by an agent who lives for a finite period of time. Other characteristics of the environment are the existence of technology-specific learning-by-doing, technology growth, and adoption costs. A finite planning horizon implies that the technology adoption problem is non-stationary and the frequency of adoptions changes over time. This paper provides results for the computation of the optimal plan and explores numerically the life-cycle pattern of technology switches. Adoptions may become more frequent as the agent grows older. However, the sign of the association between age and the adoption of new technologies is sensitive to variation in parameters. This is not at odds with the findings of recent empirical studies.
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Published date: 2004
Keywords:
learning-by-doing, technology adoption
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Local EPrints ID: 33453
URI: http://eprints.soton.ac.uk/id/eprint/33453
ISSN: 0165-1889
PURE UUID: f8c9b78a-9b3c-4c6f-9eb4-14cad7d8bb2c
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Date deposited: 15 May 2006
Last modified: 15 Mar 2024 07:44
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Author:
Xavier Mateos-Planas
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