Price Setting and Rapid Technology Adoption: The Case of the PC Industry

• 成果类型: Article
• 署名作者: Copeland, Adam; Shapiro, Adam Hale
• 署名单位: Federal Reserve System - USA; Federal Reserve Bank - New York; Federal Reserve System - USA; Federal Reserve Bank - San Francisco
• 刊物名称: REVIEW OF ECONOMICS AND STATISTICS
• ISSN/ISSBN: 0034-6535
• DOI: 10.1162/REST_a_00539
• 发表日期: 2016-07
• 页码: 601-616
• 关键词: personal computers; moores law; COMPETITION; INNOVATION; QUALITY; GROWTH; dispersion

摘要

We examine how the confluence of competition and upstream innovation influences downstream firms' profit-maximizing strategies. We focus on personal computers and use two novel data sets to describe the dramatic fall in both price (27% at an annual rate) and sales of a computer over its product cycle. Further, we document that computers are typically sold for only four months before being replaced by a higher-quality product. To explain these facts, we develop and calibrate a vintage capital model that combines a competitive market structure with an exogenous rapid rate of innovation.