Scale versus Scope in the Diffusion of New Technology: Evidence from the Farm Tractor

69 Pages Posted: 8 Nov 2014 Last revised: 9 Dec 2017

See all articles by Daniel P. Gross

Daniel P. Gross

Harvard Business School; National Bureau of Economic Research

Multiple version iconThere are 2 versions of this paper

Date Written: October 2, 2017

Abstract

Using the farm tractor as a case study, I show that lags in technology diffusion arise along two distinct margins, which I term scale and scope. Though tractors are now used in nearly every agricultural field operation and in the production of nearly all crops, they first developed with much more limited application. Early diffusion was accordingly rapid in these narrower applications, but limited in scope until tractor technology generalized. The sequence of diffusion is consistent with a model of R&D in specific- versus general-purpose attributes and with other historical examples, suggesting that the key to understanding technology diffusion lies not only in explaining the number of different users, but also in explaining the number of different uses.

Keywords: Technology diffusion; Spatial technology diffusion; Farm tractors; R&D; General-purpose technologies

JEL Classification: N52, O13, O32, O33, Q16

Suggested Citation

Gross, Daniel P., Scale versus Scope in the Diffusion of New Technology: Evidence from the Farm Tractor (October 2, 2017). Harvard Business School Research Paper No. 16-108. Available at SSRN: https://ssrn.com/abstract=2520126 or http://dx.doi.org/10.2139/ssrn.2520126

Daniel P. Gross (Contact Author)

Harvard Business School ( email )

Harvard Business School
Soldiers Field Road
Boston, MA 02163
United States

National Bureau of Economic Research ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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