Diffusion of New Technologies

A Tweet and blog post from Christina Cacioppo about technological diffusion led me to dig out a relevant slide and text from my book.  Ms. Cacioppo, reflecting on a talk she just saw, asks "Are we really to believe there was no "new" technology diffusion between 1950 and 1990? I thought this was the US's Golden Age of Growth. (Should we include penicillin, nuclear power, or desktop computers on this chart?)".  There is such data out there, but it can be obscure.

As it happens, thanks to my work with bio-era, I am familiar with a 1997 Forbes piece by Peter Brimlow that explores what he called "The Silent Boom".  Have a look at the text (the accompanying chart is not available online), but basically the idea is that keeping track of the cost of a technology is less informative than tracking actual market penetration, which is sometimes called "technological diffusion".  The time between the introduction of a technology and widespread adoption is a "diffusion lag".  The interesting thing for me is that there appears to be a wide distribution of diffusion lags; that is, some technologies hit the market fast (which can still mean decades) while others can take many more decades.  There really isn't enough data to say anything concrete about how diffusion lags are changing over time, but I am willing to speculate that not only are the lags getting shorter (more rapid market adoption), but that the pace of adoption is getting faster (steeper slope).  Here is the version of the chart I use in my talks, followed by a snippet of related text from my book (I am sure there is a better data set out there, but I have not yet stumbled over it):

And from pg 60 of Biology is Technology:

Diffusion lags in acceptance appear frequently in the adoption of new technologies over the last several centuries. After the demonstration of electric motors, it took nearly two decades for penetration in U.S. manufacturing to reach 5% and another two decades to reach 50%. The time scale for market penetration is often decades[6] (see Figure 5.6). There is, however, anecdotal evidence that adoption of technologies may be speeding up; "Prices for electricity and motor vehicles fell tenfold over approximately seven decades following their introduction. Prices for computers have fallen nearly twice as rapidly, declining ten-fold over 35 years."[4]

Regardless of the time scale, technologies that offer fundamentally new ways of providing services or goods tend to crop up within contexts set by preceding revolutions. The interactions between the new and old can create unexpected dynamics, a topic I will return to in the final chapter. More directly relevant here is that looking at any given technology may not give sufficient clues as to the likely rate of market penetration. For example, while the VCR was invented in 1952, adoption remained minimal for several decades. Then, in the late 1970's the percentage of ownership soared. The key underlying change was not that consumers suddenly decided to spend more time in front of the television, but rather that a key component of VCRs, integrated circuits, themselves only a few decades old at the time, started falling spectacularly in price. That same price dynamic has helped push the role of integrated circuits into the background of our perception, and the technology now serves as a foundation for other "independent" technologies ranging from mobile phones, to computers, to media devices.