It is now clear that different technological domains have significantly different rates of performance improvement. Prior theory indicates that such differing rates should influence the relative speed of diffusion of the products  since improvement in performance during the diffusion process increases the desirability of the product diffusing. However, there has not been a broad empirical attempt to examine this effect and to clarify the underlying cause. Therefore, this paper reviews the theoretical basis and focuses upon empirical tests of this effect across multiple products and their underlying technologies. The results for 18 different diffusing products show the expected relationship-faster diffusion for products based on more rapidly improving technological domains- between technological improvement and diffusion with strong statistical significance. The empirical examination also demonstrates that technological improvement does not slow down in the latter parts of diffusion when penetration does slow down. This finding is not consistent with ideas that explain technological performance increases as due to competition among firms .
Different technological domains have significantly different rates of performance improvement. Prior theory indicates that such differing rates should influence the relative speed of diffusion of the products embodying the different technologies since improvement in performance during the diffusion process increases the desirability of the product diffusing. However, there has not been a broad empirical attempt to examine this effect and to clarify the underlying cause. Therefore, this paper reviews the theoretical basis and focuses upon empirical tests of this effect across multiple products and their underlying technologies. The results for 18 different diffusing products show the expected relationship-faster diffusion for products based on more rapidly improving technological domains- between technological improvement and diffusion with strong statistical significance. The empirical examination also demonstrates that technological improvement does not slow down in the latter parts of diffusion when penetration does slow down. This finding indicates that diffusion slow down in the latter stages is due to market saturation effects and is not due to slowdown of performance improvement .
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It is now clear that different
Different
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embodying the different technologies
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is not consistent with ideas that explain technological performance increases as due to competition among firms
indicates that diffusion slow down in the latter stages is due to market saturation effects and is not due to slowdown of performance improvement