Decomposing Productivity Growth In The U.S. Computer Industry

Topics:
Organization
Tags:
Product Innovation,
Total Factor Productivity
Source:
City University of New York

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Overview: This paper examines the sources of the productivity growth in the U.S. computer industry from 1978 to 1999. It estimates a joint production model of output quantity and quality that distinguishes two types of technological changes: process and product innovations. Based on the estimation results, Total Factor Productivity (TFP) growth rate is decomposed into the contributions of process and product innovations and scale economies. The results show that product innovation associated with better quality accounts for about 30 percent of the TFP growth in the computer industry. Furthermore, the TFP acceleration in the computer industry in the late 1990s is mainly derived from a rapid increase in product innovation.

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Format: PDF | Size: 185KB | Date: Dec 2005 | Pages: 20


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