Revolution in the Defence Electronics Markets? An Economic Analysis of Sectoral Change
AbstractWithin the defence sector there have been marked changes in the nature of the composite industries. This is particularly true of the electronics industry which continues to grow in importance, with electronic components built into nearly every weapons system and piece of equipment. Given the âRevolution in Military Affairsâ (RMA) it seems certain that this growth will continue, impacting on both product and process. The result, however, may not be the contestable open market many expect (and hope for) as Network Enabled Warfare may result in new entrants, such as IT specialist and increased competition. Alternatively the nature of the market may continue to benefit the incumbents. This paper presents an analysis of the changes taking place in the industry using firm-level, primary, survey-based, qualitative data on corporate conduct. The results suggest that in practice the incumbents do seem to be in a strong position. The new demands of the customer require much more than mere technical capability. Specialists who do not have established industry relationships, who do not understand industry âprotocolsâ and who cannot communicate effectively with the customer are unlikely to survive. This suggests that rather than new entrants, there may in fact be exits from the industry and further consolidation.
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Bibliographic InfoArticle provided by SKEMA Business School in its journal Frontiers in Finance and Economics.
Volume (Year): 2 (2005)
Issue (Month): 1 (June)
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Defence; electronics; industry structure; conduct; contestability;
Other versions of this item:
- Paul Dowdall & Derek Braddon, 2005. "Revolution in the Defence Electronics Market? An Economic Analysis of Sectoral Change," Working Papers 0506, Department of Accounting, Economics and Finance, Bristol Business School, University of the West of England, Bristol.
- D2 - Microeconomics - - Production and Organizations
- D4 - Microeconomics - - Market Structure and Pricing
- L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
- L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior
- L63 - Industrial Organization - - Industry Studies: Manufacturing - - - Microelectronics; Computers; Communications Equipment
- O3 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights
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