Decomposing productivity growth in the U.S. computer industry

Hyunbae Chun, M. Ishaq Nadiri

    Research output: Contribution to journalArticle

    Abstract

    In this paper, we examine the sources of the productivity growth in the U.S. computer industry from 1978 to 1999. We estimate 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, we decompose total factor productivity (TFP) growth rate into the contributions of process and product innovations and scale economies. We find that product innovation associated with better quality accounts for about 30% 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.

    Original languageEnglish (US)
    Pages (from-to)174-180
    Number of pages7
    JournalReview of Economics and Statistics
    Volume90
    Issue number1
    DOIs
    StatePublished - Feb 1 2008

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    ASJC Scopus subject areas

    • Social Sciences (miscellaneous)
    • Economics and Econometrics

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