We formalize Schumpeter's explanation of technological progress and growth cycles in a model where consumers and firms benefit from periodic changes in technology which result in the development and marketing of new generations of products. We develop a genera/ equilibrium dynamic differentiated products model in order to explain technological progress via cyclical changes in investment, output, and interest rates as well as the introduction of new products. We characterize the equilibrium and analyze the effect of changes in the rate of technology growth, resource endowment, and costs of REM and production on the duration of generations of products and the frequency of technology revolutions, and hence of growth cycles.