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Technological Competition and the Structure of the Computer Industry

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  • Bresnahan, Timothy F
  • Greenstein, Shane

Abstract

The authors examine thirty years of computer industry market structure. Their analysis explains the persistence of dominant computer firms, their recent decline, and the changing success of competitive entry. It emphasizes the importance of technological competition between computer 'platforms,' not firms. This aspect of competition has changed little over time. Two things did change. Young platforms serving newly founded segments eventually challenged established platforms across segment boundaries through a process of indirect entry. Vertically disintegrated platforms have led to divided technical leadership in important segments. The result is an industry with far more technological competition. Copyright 1999 by Blackwell Publishing Ltd

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Bibliographic Info

Article provided by Wiley Blackwell in its journal Journal of Industrial Economics.

Volume (Year): 47 (1999)
Issue (Month): 1 (March)
Pages: 1-40

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Handle: RePEc:bla:jindec:v:47:y:1999:i:1:p:1-40

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  1. David, Paul A, 1985. "Clio and the Economics of QWERTY," American Economic Review, American Economic Association, vol. 75(2), pages 332-37, May.
  2. Stephen E. Margolis & S.J. Liebowitz, . "Path Dependence, Lock-in and History," Working Paper Series 10, North Carolina State University, Department of Economics.
  3. Gort, Michael & Klepper, Steven, 1982. "Time Paths in the Diffusion of Product Innovations," Economic Journal, Royal Economic Society, vol. 92(367), pages 630-53, September.
  4. Stanley M. Besen & Joseph Farrell, 1994. "Choosing How to Compete: Strategies and Tactics in Standardization," Journal of Economic Perspectives, American Economic Association, vol. 8(2), pages 117-131, Spring.
  5. Caves, R E & Porter, M E, 1977. "From Entry Barriers to Mobility Barriers: Conjectural Decisions and Contrived Deterrence to New Competition," The Quarterly Journal of Economics, MIT Press, vol. 91(2), pages 241-61, May.
  6. David, Paul A. & Steinmueller, W. Edward, 1994. "Economics of compatibility standards and competition in telecommunication networks," Information Economics and Policy, Elsevier, vol. 6(3-4), pages 217-241, December.
  7. Timothy F. Bresnahan & Franco Malerba, 1997. "Industrial Dynamics and the Evolution of Firms' and Nations' Competitive Capabilities in the World Computer Industry," Working Papers 97030, Stanford University, Department of Economics.
  8. Greenstein, Shane M, 1997. "Lock-in and the Costs of Switching Mainframe Computer Vendors: What Do Buyers See?," Industrial and Corporate Change, Oxford University Press, vol. 6(2), pages 247-73, March.
  9. Steinmueller ,W. Edward, 1995. "The U.S. software industry : an analysis and interpretative history," Research Memorandum 006, Maastricht University, Maastricht Economic Research Institute on Innovation and Technology (MERIT).
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