Staff Report 184

Resistance to Technology and Trade Between Areas

James A. Schmitz, Jr. | Senior Research Economist
Thomas J. Holmes | University of Minnesota, Federal Reserve Bank of Minneapolis

Published October 1, 1994

Abstract
Why are methods of production used in an area when more “efficient” methods are available? This paper explores a “resistance to technology” explanation. In particular, the paper attempts to understand why some industries, like the construction industry, have had continued success in blocking new methods, while others have met failure, like the dairy industry's recent attempt to block bST. We develop a model which shows that how easily goods move between areas determines in part the extent of resistance to new methods in an area.


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