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How Predictable is Technological Progress?

SSRN Electronic Journal
2015
  • 14
    Citations
  • 2,418
    Usage
  • 47
    Captures
  • 0
    Mentions
  • 0
    Social Media
Metric Options:   Counts1 Year3 Year

Metrics Details

  • Citations
    14
    • Citation Indexes
      14
  • Usage
    2,418
    • Abstract Views
      2,073
    • Downloads
      345
  • Captures
    47
  • Ratings
    • Download Rank
      175,455

Article Description

Recently it has become clear that many technologies follow a generalized version of Moore's law, i.e. costs tend to drop exponentially, at different rates that depend on the technology. Here we formulate Moore's law as a correlated geometric random walk with drift, and apply it to historical data on 53 technologies. We derive a closed form expression approximating the distribution of forecast errors as a function of time. Based on hind-casting experiments we show that this works well, making it possible to collapse the forecast errors for many different technologies at different time horizons onto the same universal distribution. This is valuable because it allows us to make forecasts for any given technology with a clear understanding of the quality of the forecasts. As a practical demonstration we make distributional forecasts at different time horizons for solar photovoltaic modules, and show how our method can be used to estimate the probability that a given technology will outperform another technology at a given point in the future.

Bibliographic Details

J. Doyne Farmer; Francois Lafond

Elsevier BV

forecasting; technological progress; Moore's law; solar energy

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