Inter-firm diffusion of process innovations

This paper introduces a model of the diffusion of process innovations. It predicts that the inter- firm diffusion curve, showing the proportion of firms having adopted a given innovation, will follow either a cumulative normal time path for major and technically complex innovations or a cumulative lognormal time path for simpler and less expensive innovations. This prediction is tested, with satisfactory results, against data on the diffusion of various innovations in the U.K. The model also provides a limited explanation of why some firms adopt faster than others and identifies a number of factors which will determine the aggregate speed of diffusion.