Cover: An Analysis of Cost Improvement in Chemical Process Technologies

An Analysis of Cost Improvement in Chemical Process Technologies

Published 1989

by Edward W. Merrow

Download eBook for Free

FormatFile SizeNotes
PDF file 2.4 MB

Use Adobe Acrobat Reader version 10 or higher for the best experience.

Cost improvement — sometimes called the learning curve or progress curve — plays a crucial role in the competitiveness of the U.S. chemical industry. More rapid cost improvement for a product results in expanding market share and larger profits. Using information from ten in-depth case studies and a database consisting of year-by-year market histories of 44 chemical products, including organic chemicals, inorganic chemicals, synthetic fibers, and primary metals, this report explores the relationships among the rate of learning and characteristics of the technologies, the nature of markets, and management approaches. The author concludes that (1) rates of improvement are dominated by technological factors, including the complexity of the basic production process and the type of chemical product, i.e., its phase (solid, liquid, or gas) and whether it is a primary or secondary chemical; and (2) there is no relationship between improvement slopes and market factors such as industry concentration or the rate of market expansion, except for the obvious finding that improvement is more rapid in rapidly expanding markets.

This report is part of the RAND report series. The report was a product of RAND from 1948 to 1993 that represented the principal publication documenting and transmitting RAND's major research findings and final research.

This document and trademark(s) contained herein are protected by law. This representation of RAND intellectual property is provided for noncommercial use only. Unauthorized posting of this publication online is prohibited; linking directly to this product page is encouraged. Permission is required from RAND to reproduce, or reuse in another form, any of its research documents for commercial purposes. For information on reprint and reuse permissions, please visit www.rand.org/pubs/permissions.

RAND is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND's publications do not necessarily reflect the opinions of its research clients and sponsors.