Flexible manufacturing systems(FMS) are among the most important industrial applications of information technology. Yet, there is general agreement that there is very sketchy, incomplete and unsystematic information concerning the rate of diffusion of FMS and its impact on the productivity of capital and labor. This research improves models of diffusion and collects original data on the use of FMS in the United States, Europe and Japan. The research studies the process by which the utilization of FMS has and will spread in major industrialized nations, the extend to which existing mathematical models of the diffusion process fit the data concerning the rate of diffusion of FMS in each country, modifies and extends these models to improve their usefulness, investigates the reasons why the Japanese seem to be ahead in the utilization of FMS, analyzes the impacts of FMS on the productivity of capital and labor and on total costs in each country, and analyzes the nature and adequacy of methods used by firms to evaluate investments in such systems. The research is significant from the point of view of analysis and policy because it will improve our ability to understand diffusion processes generally and will produce important information on the factors affecting the diffusion and impact of FMS in Japan, Europe and the U.S. This is important information in our national effort to improve the international competitiveness of the U.S.
