Evidence of Qualitative Learning-by-Doing from the Advent of the 'Talkie.'.

Empirical work on learning-by-doing has largely been limited to examinations of production costs. In this paper I present anecdotal and statistical evidence of qualitative learning (the idea that product quality improves as producers gain experience with the relevant technology). Using U.S. motion picture industry data from 1925 to 1941, I reject that the transition to sound pictures resulted in a fixed increase in film-quality in favor of my hypothesis that this quality differential increased with the producing studio's sound-experience. These results are robust to several different specifications. Copyright 2001 by Blackwell Publishing Ltd