Moore's Law

Written by True Tamplin, BSc, CEPF® | Reviewed by Editorial Team

Updated on December 14, 2022

Moore's Law Definition

Moore’s Law refers to a prediction made in 1965 by Gordon E. Moore, cofounder of Intel, that the number of transistors that can be packed into a computer processor of a given size should be expected to double every two years, while the cost of said computers is halved.

When Moore made this postulation, he hadn’t set out to create a law or predict a truism; nonetheless, time proved that not only was Moore’s assumption accurate, but that the rate of doubling was increasing faster than he thought.

Today, the doubling rate for transistor capacity is around 18 months.<h2>Define Moore’s Law in Simple Terms</h2> Moore’s Law has been a guiding force in the semiconductor industry for planning research and development goals.

In turn, it has led to the prevalence of affordable yet microscopic transistors that have shaped all facets of society.

From consumer smartphones to weather forecasting to life-saving hospital equipment, every economic sector has seen improvements in productivity and efficiency due to the shrinking size of transistors.

Limitations of Moore's Law

There is a limit to Moore’s Law, however.

As transistors approach the size of a single atom, their functionality begins to get compromised due to the particular behavior of electrons at that scale.

In a 2005 interview, Moore himself stated that his law “can’t continue forever.”

Most experts agree, stating that the physical limits of transistor technology should be reached sometime in the 2020s.

Quantum Computing and Moore's Law

However, exponential increases in computational technology might not end with traditional transistors.

Quantum computing, for all intents and purposes, is not subject to many of the limitations of normal transistors.

While household quantum computers are still a ways off, in April of 2020, Intel announced that they had successfully built a quantum computer that could operate at a cost of only a few thousand dollars, much less than the older models that cost millions.

What Is Moore's Law FAQs

What is Moore's Law?

Moore’s Law refers to a prediction made in 1965 by Gordon E. Moore, cofounder of Intel, that the number of transistors that can be packed into a computer processor of a given size should be expected to double every two years, while the cost of said computers is halved.

Why is Moore's Law helpful?

Moore’s Law has been a guiding force in the semiconductor industry for planning research and development goals.

Is there a limit to Moore's Law?

There is a limit to Moore’s Law. Most experts agree that the physical limits of transistor technology should be reached sometime in the 2020s.

How has Moore's Law affected consumer spending?

Moore's Law has led to the prevalence of affordable yet microscopic transistors that have shaped all facets of society.

What happens when we hit a physical barrier with traditional transistors?

Quantum computing, which is advancing every day - for all intents and purposes - is not subject to many of the limitations of normal transistors.

About the Author

True Tamplin, BSc, CEPF®

True Tamplin is a published author, public speaker, CEO of UpDigital, and founder of Finance Strategists.

True is a Certified Educator in Personal Finance (CEPF®), author of The Handy Financial Ratios Guide, a member of the Society for Advancing Business Editing and Writing, contributes to his financial education site, Finance Strategists, and has spoken to various financial communities such as the CFA Institute, as well as university students like his Alma mater, Biola University, where he received a bachelor of science in business and data analytics.

To learn more about True, visit his personal website, view his author profile on Amazon, or check out his speaker profile on the CFA Institute website.

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