Abstract
This paper quantitatively measures technological change in U.S. jet fighter aircraft from 1944 to the present day using the hedonic pricing approach. The technical and performance characteristics of jet fighters have changed dramatically between the time they were first developed at the beginning of the 1940s and the present. Parallel to this technological change there has been a sharp escalation in costs regarding the new generations of jet fighter aircraft. We estimate a measure of price for the performance and technical characteristics of these aircraft. Embodied technological change in jet fighter airframes is measured using quality-adjusted prices. Although the flyaway cost of jet fighter aircraft has soared, on average, by about 12.63% per year, the quality-adjusted aircraft cost has only risen by about 2.6% per year, a figure lower than the average observed general inflation rate for the period (around 4%). This represents an impressive average technological progress ratio of around 10% per year. A revealed preferences argument shows that the characteristic most valued by the government is stealth capability, followed by advanced avionics.
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