The Progress of Computing

53 Pages Posted: 27 Sep 2001

See all articles by William D. Nordhaus

William D. Nordhaus

Yale University - Department of Economics; Cowles Foundation, Yale University; National Bureau of Economic Research (NBER)

Date Written: September 2001

Abstract

The present study analyzes computer performance over the last century and a half. Three results stand out. First, there has been a phenomenal increase in computer power over the twentieth century. Performance in constant dollars or in terms of labor units has improved since 1900 by a factor in the order of 1 trillion to 5 trillion, which represent compound growth rates of over 30 percent per year for a century. Second, there were relatively small improvements in efficiency (perhaps a factor of ten) in the century before World War II. Around World War II, however, there was a substantial acceleration in productivity, and the growth in computer power from 1940 to 2001 has averaged 55 percent per year. Third, this study develops estimates of the growth in computer power relying on performance rather than on input-based measures typically used by official statistical agencies. The price declines using performance-based measures are markedly higher than those reported in the official statistics.

Keywords: Productivity, Hedonic Pricing, History of Computing

JEL Classification: O3, O4, E31, N1

Suggested Citation

Nordhaus, William D., The Progress of Computing (September 2001). Available at SSRN: https://ssrn.com/abstract=285168

William D. Nordhaus (Contact Author)

Yale University - Department of Economics ( email )

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Cowles Foundation, Yale University ( email )

Box 208281
New Haven, CT 06520-8281
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
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