Rapid improvements with no commercial production: How do the improvements occur?

This paper empirically examines 13 technologies in which significant cost and performance improvements occurred even while no commercial production occurred. Since the literature emphasizes cost reductions through increases in cumulative production, this paper explores cost and performance improvements from a new perspective. The results demonstrate that learning in these pre-commercial production cases arises through mechanisms utilized in deliberate R&D efforts. We identity three mechanisms – materials creation, process changes, and reductions in feature scale – that enable these improvements to occur and use them to extend models of learning and invention. These mechanisms can also apply during post-commercial time periods and further research is needed to quantify the relative contributions of these three mechanisms and those of production-based learning in a variety of technologies.