External Learning Opportunities and the Diffusion of Process Innovations to Small Firms

In this paper, we are concerned with explaining which types of small firms have failed to adopt well-known improvements in process technology. That problem has of course been the underlying concern of all studies of diffusion: “to rationalize why, if a new technology is superior, it is not taken up by all potential adopters” [ 11. Drawing on various theoretical perspectives, we identify a number of different barriers to adoption. With data that we collected from a 1987 nationally representative sample of US establishments in 21 metalworking and machinery-manufacturing industries, we constructed a multivariate logistic regression model to test empirically for the effects of these factors on the likelihood of adoption of a particular process innovation, namely, programmable automation (PA) machine tools.

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