IDEAS home Printed from https://ideas.repec.org/h/pal/palchp/978-0-230-50531-5_2.html
   My bibliography  Save this book chapter

Selection and Evolution of Industry

In: Competition and Growth

Author

Listed:
  • Jati K. Sengupta

    (University of California)

Abstract

The evolution of industry depends on the selection mechanism, that is, the process of entry and exit of firms and the various factors influencing the entry and exit decisions. Three major factors are most important in the selection process. One is the evolutionary perspective which emphasizes the firm’s ability and competence to alter their market position and hence through strong increasing returns to scale, to alter the market structure significantly. Following the Schumpeterian theory of technological innovations the main source of such increasing returns is the cumulative aspect of innovations, where “size begets size” causes industrial dynamics to be characterized by nonlinear and path dependent processes, where random events like a new technical process may have lasting and irreversible effects on the dynamic evolution of the selection process. Secondly, firms differ significantly in their commitment and ability to innovate. Thus innovations in products and processes are largely endogenous to the firm through R&D investment and learning-by-doing. Thus vigorous innovation has been found to generate more competitive market structures, while innovations requiring large investment generally involve more concentration through large size firms. Also due to the cumulative nature of technological innovations firms that discover new technologies are able to maintain their lead even after the particular technology is obsolete.

Suggested Citation

  • Jati K. Sengupta, 2004. "Selection and Evolution of Industry," Palgrave Macmillan Books, in: Competition and Growth, chapter 2, pages 36-70, Palgrave Macmillan.
    • Handle: RePEc:pal:palchp:978-0-230-50531-5_2
    DOI: 10.1057/9780230505315_2
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Sahoo, Biresh K & Khoveyni, Mohammad & Eslami, Robabeh & Chaudhury, Pradipta, 2016. "Returns to scale and most productive scale size in DEA with negative data," European Journal of Operational Research, Elsevier, vol. 255(2), pages 545-558.
    2. Ramakrushna Panigrahi, 2021. "Evaluating Level Efficiency Versus Growth Efficiency in the Indian Automobile Industry in a Non-parametric DEA Approach," Global Business Review, International Management Institute, vol. 22(4), pages 963-976, August.
    3. Ramakrushna Panigrahi, 2021. "Returns to Growth in Indian Automobile Industry: A Non-Parametric Data Envelopment Analysis (DEA) Approach," Journal of Quantitative Economics, Springer;The Indian Econometric Society (TIES), vol. 19(4), pages 747-765, December.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pal:palchp:978-0-230-50531-5_2. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.palgrave.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.