Learning, Complementarities, and Asynchronous Use of Technology

35 Pages Posted: 20 Sep 2000 Last revised: 4 Oct 2010

See all articles by Boyan Jovanovic

Boyan Jovanovic

New York University - Department of Economics

Dmitriy Stolyarov

University of Michigan at Ann Arbor - Department of Economics

Date Written: January 1997

Abstract

This paper deals with processes that require several complementary inputs subject to improvements in quality. If after a quality upgrade one of these inputs requires a period of learning before it can be used effectively, then in general it will pay to purchase the inputs at different dates -- the purchases will be asynchronous. That is so because it is wasteful to tie up funds in the other inputs which will be underutilized until the date learning is over. We provide evidence that technology has been used asynchronously in the automobile industry, in the television broadcasting industry, in electricity supply, and in railways, and we argue that our model helps explain this evidence.

Suggested Citation

Jovanovic, Boyan and Stolyarov, Dmitriy, Learning, Complementarities, and Asynchronous Use of Technology (January 1997). NBER Working Paper No. w5870, Available at SSRN: https://ssrn.com/abstract=225654

Boyan Jovanovic (Contact Author)

New York University - Department of Economics ( email )

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Dmitriy Stolyarov

University of Michigan at Ann Arbor - Department of Economics ( email )

611 Tappan Street
Ann Arbor, MI 48109-1220
United States
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734-764-279 (Fax)

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