"hands-on" learning by users is fed back to developers and incorporated into redesigned versions of a machine or piece of software. As a result, other users of the technology may get an improved version of the original technology, which is a reason to delay commitment to a new technology. This is particularly true if the adoption of subsequent versions of a specific technology is expected to be relatively less costly and if waiting to adopt a technology does not put a firm at an immediate competitive disadvantage.

Other factors affecting the speed with which firms adopt new technologies include the costs of these new technologies. The costs in many cases depend on domestic interest rates and other factors affecting the cost of capital, the state of development of technical standards, and the level of worker skills. Because the adoption of most new technologies is the outcome of investment decisions, rates of gross domestic capital formation affect the rate at which the domestic capital stock is "turned over" and new equipment replaces older machinery. Economic factors affecting capital formation therefore may influence international differences in the rate of adoption of new technologies. Technical standards can reduce the information costs associated with evaluating and adopting new technologies (e.g., by reducing the requirements for extensive customization of a machine or system for a specific installation).

Finally, the skills of the production work force in manufacturing industries can influence the costs and the rate of adoption of new technologies. A work force that is functionally illiterate, for example, will require more expensive training than one that is well-endowed with basic skills. The influence of worker skills may be especially important for the adoption of computer-based manufacturing technologies (robotics, computer-integrated manufacturing, etc.), since these technologies often place greater demands on the cognitive and numerical abilities of production workers, as well as their ability to diagnose problems in the production process.

The costs of adoption may make it especially difficult for smaller and medium-sized firms to utilize new technologies. This is because many small and medium-sized firms have limited resources, lack access to external sources of capital, and do not benefit from the same economies of scale available to larger manufacturers that adopt new technologies.

The importance of technology adoption means, among other things, that the economic benefits from the innovative activities of high-technology industries are not confined to those industries, but potentially can be reaped by firms in so-called low-technology, less R&D-intensive industries. The international competitive performance of Japan, Sweden, and Germany is based in part on the ability of firms in "mature," less R&D-intensive industries (e.g., automobiles, machine tools, and textiles) to quickly and effectively incorporate new products and processes into their products.