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The Diffusion of Innovations: A Methodological Reappraisal
Authors:Manuel Trajtenberg  Shlomo Ystzhaki
Institution:1. Department of Economics , Tel Aviv University , Tel Aviv , 69978 , Israel;2. Department of Economics , Hebrew University of Jerusalem , Jerusalem , 91905 , Israel
Abstract:Studies of diffusion have traditionally relied on specific distributions, primarily the logistic, to characterize and estimate those processes. We argue that such an approach gives rise to serious problems of comparability and interpretation and may result in large biases in the estimates of the parameters of interest. We propose instead the Gini's expected mean difference as a measure of diffusion speed. We discuss its advantages over the traditional approach, present a nonparametric estimation procedure, and tackle with it the problems of truncated processes and of intergroup comparisons. We also elaborate on the use of the hazard rate and suggest various extensions. The diffusion of computed tomography scanners is presented as an illustration.
Keywords:Computed tomography scanners  Gini's expected mean difference  Innovation diffusion  Logistic distribution  Technological change
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