Working Paper: NBER ID: w8762
Authors: Boyan Jovanovic; Peter L. Rousseau
Abstract: We model Moore's Law as efficiency of computer producers that rises as a by-product of their experience. We find that (1) Because computer prices fall much faster than the prices of electricity-driven and diesel-driven capital ever did, growth in the coming decades should be very fast, and that (2) The obsolescence of firms today occurs faster than before, partly because the physical capital they own becomes obsolete faster.
Keywords: Moore's Law; Learning by Doing; Efficiency; Economic Growth
JEL Codes: O3; N1
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Moore's Law (L63) | increased efficiency among computer producers (L63) |
| cumulative experience in production (E23) | efficiency growth of computer producers (O49) |
| increased efficiency (D61) | faster price declines (E31) |
| efficiency gains (D61) | growth in consumption (F62) |
| capital age (P17) | decline in firms' market-to-book ratios (G32) |
| learning-by-doing effect in technology production (O49) | growth rate of productivity (O49) |