Chips ahoy: The semiconductor

UBS

Ulrike Hoffmann-Burchardi

Research

12 Pages

UBS’ 250 years of US innovation publication series highlights examples of how transformational innovation has been an engine of US economic growth since the nation’s founding. This edition explores the history and application of the semiconductor and microchip.

Key Takeaways

Importance: The microchip, or integrated circuit (IC), forms the backbone of modern electronics. Its invention and subsequent evolution have fundamentally transformed industries, economies, and daily life—enabling technologies ranging from smartphones to supercomputers.
Moore's Law: Advancements in lithography have enabled the exponential progress described by Moore’s Law—named after Gordon Moore, co-founder of Intel—which predicts that the number of transistors on a microchip doubles every two years. This principle has become the industry standard for chip design, resulting in dramatic increases in computing power and significant reductions in cost.
Productivity Boost: Improved manufacturing processes boosted production volumes, which enabled chip prices to decline and yielded far broader adoption across a range of new applications.
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