Finance and Economics Discussion Series: Shifting Trends in Semiconductor Prices and the Pace of Technological Progress
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Author Description
This paper examines three questions motivated by previous research on semiconductors and productivity growth: Why did semiconductor prices fall so rapidly in the second half of the 1990s, why has the rate of price decline slowed since 2001, and to what extent are these price swings associated with changes in the rate of advance in semiconductor technology? We show that the price swings are statistically significant and that they reflect changes in both price-cost markups and cost trends. Further analysis indicates that the shift to faster cost declines in the mid-1990s likely corresponded to a speed-up in the pace of advance in semiconductor technology; however, the slower cost declines since 2001 appear not to have been mirrored by a deceleration in technology. Consequently, researchers should be cautious about associating price or cost movements for semiconductors with changes in the pace of underlying technology even over moderately long periods.
Menrva's Summary
THE THESIS
This paper investigates the dynamic relationship between semiconductor price fluctuations and the pace of technological advancement. The author, Ana M. Aizcorbe, addresses key questions regarding the rapid decline in semiconductor prices during the late 1990s, the subsequent slowdown after 2001, and the extent to which these price shifts correlate with changes in semiconductor technology. Utilizing statistical analysis, the research demonstrates that these price swings are significant and are influenced by alterations in both price-cost markups and cost trends, providing a nuanced understanding of market dynamics.
THE SCOPE MAP
- Analysis of rapid semiconductor price declines in the second half of the 1990s.
- Examination of the slowing rate of semiconductor price decline since 2001.
- Assessment of the association between semiconductor price swings and technological progress.
- Statistical significance of price swings and their reflection in price-cost markups.
- Investigation into changes in cost trends as a factor in price fluctuations.
- Correlation between faster cost declines in the mid-1990s and accelerated technological advancement.
- Discussion on whether slower cost declines since 2001 indicate a deceleration in technology.
- Cautionary note for researchers on associating semiconductor price/cost movements with technology pace.
THE AUTHORITY PERSPECTIVE
This paper is a focused academic study that delves into the intricate economic factors influencing the semiconductor industry. Its analysis of price-cost markups and cost trends provides a detailed framework for understanding market behavior. The research suggests a complex, non-linear relationship between technological progress and price movements, cautioning against simplistic correlations. Scholars and industry analysts focusing on the economics of technology and semiconductor markets will find this a valuable contribution.
Page Count:
48
Publication Date:
2013-02-05
Publisher:
BiblioGov
ISBN-10:
1288708963
ISBN-13:
9781288708963
Business
Science & Technology
Non-Fiction
Economics
Semiconductors
Technology
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