Machine Replacement, Technology Adoption and Convergence.
Boucekkine, Raouf; Martinez, Blanca;
- Subject: Technology adoption | Fluctuations | Convergence | Machine replacement; Technology adoption; Optimal scrapping; Fluctuations; Convergence | Optimal scrapping | Machine replacement
- jel: jel:E32 | jel:E22 | jel:O40 | jel:C63
In this paper, we introduce adoption costs in a canonical vintage capital model. Adoption costs take the form of a direct loss in production during a fixed period of time. We explicitly characterize the optimal machine replacement policy as a function of the adoption pe... View more