Quality Innovation: An Economic Analysis of Rapid Improvements in Microelectronic Components

This book offers one of the first analyses of the economic forces behind the introduction of new, improved versions of existing microelectronic products, with particular emphasis on the microelectronics components industry from 1960 to 1983. Swann begins with a concise account of the theories of quality innovation and quality choice. He discusses the byproducts of microelectronic technology, the measurement of computer systems and hence, product quality, and the most important issues in the economics of product design and production. He demonstrates that quality innovation in microprocessors can be described by a time series of price functions, an important preliminary for an econometric analysis of quality choice. The quality innovation strategies of individual microelectronics producers and the changing demand for their products are examined and described. As an alternative perspective on the analysis of quality demand, the author provides three case studies examining whether, from an engineering point of view, the quality of available of available components hampered the development of particular applications. These case studies provide a realistic understanding of the many issues that must be resolved before microelectronic innovations can be used effectively. In conclusion, Swann contends that the market incentive for quality innovation often appears well before the end-user is able to appreciate fully the true value of the innovation.