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Doug Henwood dhenwood at panix.com
Sun Nov 18 18:13:41 PST 2001


"The Progress of Computing"

BY: WILLIAM D. NORDHAUS

Yale University

Department of Economics

Document: Available from the SSRN Electronic Paper Collection:

http://papers.ssrn.com/paper.taf?abstract_id=285168

Paper ID: Cowles Foundation Discussion Paper No. 1324

Date: September 2001

Contact: WILLIAM D. NORDHAUS

Email: Mailto:william.nordhaus at yale.edu

Postal: Yale University

Department of Economics

New Haven, CT 06520 USA

Paper Requests:

Recent papers downloadable from SSRN and Cowles Foundation.

Contact Art Trager, Mailto:art.trager at yale.edu for older papers.

No Charge for first 3 items, additional items must be prepaid

at: $3.00 each US, $4.00 each International.

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



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