Archived — Research Summaries: Working Paper 2007-06: Impediments and Facilitators of Technology Adoption and Diffusion: A Literature Survey of the Last 10 Years

by Johannes Van Biesebroeck.

With increasing globalization of markets, Canadian firms are facing fierce and growing competition. To remain internationally competitive, Canadian firms are expected to produce high-quality, customized goods quickly and at reasonable cost. Adoption of advanced technologies is a crucial ingredient to meet this challenge. Adoption and diffusion of advanced technologies or work practices are the outcomes of deliberate processes. Heterogeneity in incentives, firm capabilities, and government interventions lead to important variations in technology use across industries and firms. This paper provides a review, summary, and critical evaluation of several distinct literatures that identify impediments and facilitators to the adoption and diffusion of advanced technology. The paper starts by discussing the link between technology use and productivity and proceeds with an overview of the different sources of information that researchers have used to learn about the technology adoption process. The remainder and bulk of the paper is devoted to surveying evidence on the importance of a variety of impediments and facilitators drawing on studies from all countries, industries, and technologies. We point, in particular, to the importance of information. In the inherently uncertain process of adopting new technologies, the government can play an important role facilitating the sharing or creation of information. For example, governments can provide firms with information about new technologies, identify complementarities or quantify expected benefits. Governments can also put policies in place to help firms use existing information more effectively, such as providing expert information on available technological options.

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