16.11.2022 Diego Comin (Dartmouth)

Topic: “Anatomy of Technology in the Firm”


We collect data on the technologies used across business functions of establishments in Vietnam, Senegal, and Cear ́a (Brazil), and construct technology sophistication mea- sures at the business function level. The variance of technology sophistication across the business functions of an establishment is 2.8 times larger than the cross-firm variance in sophistication. We develop a model of technology adoption with non-homothetic production that predicts a stable cross-firm relationship between sophistication in the business function and firm-level technology that we call the technology curve. The slopes of technology curves differ greatly across business functions and account for 33% of within-firm variance in sophistication.

Coautohrs: Xavier Cirera, Marcio Cruz, Kyung Min Lee